Implementation of particle swarm optimization in bidding strategy under deregulated environment

Abstract

Restructuring and competition are being introduced into the electric power industry as deregulation takes place throughout the world. In the competitive electricity markets, the electricity producers come across fundamental problems of bidding into the market to maximize their expected profits. Generally bi-level bidding strategy is used to maximize the profit and to minimize the market clearing function. Computationally, this is complex and hence, researchers have adopted Karush-Kuhn-Tucker (KKT) optimality conditions to transform bi-level model into a single level maximization problem but after inclusion of transmission constraints the problem has become more complex[1]. This paper simplifies the problem in which ISO market clearing functions are considered with no KKT optimality conditions. This paper derives traditional bi-level bidding problem into single level strategic model. This derived model is solved using Particle Swarm Optimization (PSO) technique. Experimental investigation is carried out on IEEE 14 bus system.