An improved optimisation method based on augmented constraint for electricity market clearing considering non‐increasing stepwise bidding

Abstract

Abstract The development of optimization methods for market clearing aims to improve the rationality of bidding and maximise social welfare. Existing electricity markets only allow a non‐decreasing bidding curve for generating companies (GenCos) owing to the convex limitation of the optimization model. However, the marginal cost of GenCos is sometimes non‐increasing, such as GenCos involved in deep peak regulation, which requires the non‐increasing bidding of GenCos. Focussing on the non‐increasing stepwise bidding curves of the GenCos, an improved optimization method is proposed that imposes augmented constraints on the bidding segments so that each bid segment can be allocated in order. In this way, the proper sequence of the bid quantity of each segment can be guaranteed. The numeral testing results verify the effectiveness of the proposed method.

Keywords

• optimisation
• power generation economics
• power markets
• tendering