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Economic risk-based bidding strategy for profit maximisation of wind-integrated day-ahead and real-time double-auctioned competitive power markets

Economic risk-based bidding strategy for profit maximisation of wind-integrated day-ahead and real-time double-auctioned competitive power markets

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This study proposes a unique method of bidding strategy which is based on bi-level optimisation model for analysing the profits of the generation companies (GENCOs) and distribution companies in the day-ahead and real-time competitive power markets. The bi-level optimisation problem includes lower-level and upper-level problems. In the lower-level problem, market clearing model is presented, in which market clearing problem is solved, locational marginal price is minimised at load buses, net generation cost is also minimised with a simultaneous increase in profit with optimal placement of wind generator by assessing the conditional value-at-risk (CVaR). In the upper level, the profit is maximised by selecting the proper bidding strategy based on double-auctioned market mechanism. To check the effectiveness of the proposed strategy, Monte Carlo simulation and scenario-based approach are used to generate the scenarios considering the random line outages, generator outages and load variations. The CVaR is used as a risk assessment tool for the uncertainties that would inadvertently affect the profit of the GENCOs. The proposed approach is applied to the modified IEEE 30-bus system to show the effectiveness of the proposed model and its impact on the bidders and suppliers.

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