Commenced in January 2007
Frequency: Monthly
Edition: International
Paper Count: 32726
GenCos- Optimal Bidding Strategy Considering Market Power and Transmission Constraints: A Cournot-based Model

Authors: A. Badri


Restructured electricity markets may provide opportunities for producers to exercise market power maintaining prices in excess of competitive levels. In this paper an oligopolistic market is presented that all Generation Companies (GenCos) bid in a Cournot model. Genetic algorithm (GA) is applied to obtain generation scheduling of each GenCo as well as hourly market clearing prices (MCP). In order to consider network constraints a multiperiod framework is presented to simulate market clearing mechanism in which the behaviors of market participants are modelled through piecewise block curves. A mixed integer linear programming (MILP) is employed to solve the problem. Impacts of market clearing process on participants- characteristic and final market prices are presented. Consequently, a novel multi-objective model is addressed for security constrained optimal bidding strategy of GenCos. The capability of price-maker GenCos to alter MCP is evaluated through introducing an effective-supply curve. In addition, the impact of exercising market power on the variation of market characteristics as well as GenCos scheduling is studied.

Keywords: Optimal bidding strategy, Cournot equilibrium, market power, network constraints, market auction mechanism

Digital Object Identifier (DOI):

Procedia APA BibTeX Chicago EndNote Harvard JSON MLA RIS XML ISO 690 PDF Downloads 1581


[1] A.J. Wood, B.F Wollenberg, Power generation operation and control, 2nd ed., New York: John Wiley & Sons, Inc., 1996.
[2] Y. Fu, M. Shahidehpour and Z. Li, "Security-constrained unit commitment with AC constraints," IEEE Trans. Power Systems, vol. 20, no.2, pp.1001-1013, May. 2005.
[3] Z. Li and M. Shahidehpouri, "Security-constrained unit commitment for simultaneous clearing of energy and ancillary service markets," IEEE Trans. Power Systems, vol. 20, no.2, pp.1079-1088, May. 2005.
[4] C. Richter and G.B. Sheble, "A profit-based unit commitment GA for the competitive environment," IEEE Trans. Power Systems, vol. 15, no.2, pp.715-721, May. 2000.
[5] B. Pokharel, GB. Shrestha, T. Lie and S. Fleten, "Profit based unit commitment in competitive markets," Int. Conference on Power System Technology, pp. 1728-1733, Nov. 2004.
[6] L.K. Yu and Y.H. Song, "Short-term generation scheduling of thermal units with voltage security and environmental constraints," IEE Proc. Gener. Transm. Distrib., vol. 144, no. 5, pp. 469-476, Sep. 1997.
[7] H. Yamin and M. Shahidehpour, "Unit commitment using a hybrid model between lagrangian relaxation and genetic algorithm in competitive electricity market," Electric Power System Research, 68, pp. 83-92, May.2004.
[8] C.P. Cheng and C.C. Liu, "Unit commitment by lagrangian relaxation and genetic algorithm," IEEE Trans. Power Systems, vol. 15, no.2, pp.707-714, May. 2000.
[9] M.Y. Sharkh and H. Chen, "A fuzzy evolutionary programming-based methodology for security-constrained generation maintenance scheduling," Electric Power System Research, 67, pp. 67-72, May. 2003.
[10] H. Yamin, A. Agtash and M. Shahidehpour, "Security-constrained optimal scheduling for GenCos," IEEE Trans. Power Systems, vol. 19, no.3, pp.1365-1372, Aug. 2004.
[11] H.Saadat ," Power System Analysis," WCB Mc Graw Hill Companies, New York, 2002.