Determining the Ideal Proportion of Intermittent Renewable Energy in Electricity Market Considering Transmission Line Capacities Using Multi-Criteria Decision-Making

Abstract

Renewable energy sources (RES) have gained growing interest due to their ability to provide cleaner energy and high-energy efficiency. However, the integration of RES into electricity markets remains challenging due to their intermittent nature and the merit-order effect. To tackle the complex task of determining the appropriate share of variable RES for market involvement, this paper introduces a multi-criteria decision-making (MCDM) framework that merges the simple additive weighting (SAW) with the analytic hierarchy process (AHP), referred to as AHP-SAW. This paper proposes one criterion representing transmission lines and five criteria representing the electricity market. By defining these criteria and solving the mathematical model associated with the proposed AHP-SAW method, the optimal allocation of renewable resources for involvement in the wholesale market is determined, while transmission line constraints are considered. The analysis suggests that increasing the marginal costs for firms leads to different effects on transmission line congestion, depending on the firm in question. While some firms’ higher costs reduce congestion, others may exacerbate it. Also, the results prove that a significant increase in the share of renewable energy sources leads to considerable fluctuations in market prices, with prices even reaching negative values. This issue becomes an obstacle to the profitable participation of traditional units in the market, which in turn creates additional challenges for the system. By the proposed model and according to the priorities of the policymaker, 50%, 60%, and 60% of the maximum permissible share of RES are considered desirable penetration levels for the systems according to three different locations.