Pool strategy of an electricity producer considering endogenous formation of clearing prices
Abstract:
This presentation considers a strategic electricity producer that trades electric energy in a pool, and provides a procedure to derive the optimal offering strategy of this producer. A multi-period network-constrained market-clearing algorithm is considered. Uncertainty on demand bids and offering strategies of rival producers is also modeled. The proposed procedure to derive strategic offers relies on a bilevel model whose upper-level problem represents the profit maximization of the strategic producer while the lower-level one represents the market clearing and the corresponding price formation. This bilevel model is reduced to a mixed-integer linear programming problem using the duality theory and the Karush–Kuhn–Tucker optimality conditions. Results from an illustrative example and a case study are reported and discussed. Finally, some relevant conclusions are drawn.