Integrated transmission and generation planning model in a deregulated environment

Abstract

After the deregulation of the Power Sector in the U.S., planning for generation and transmission capacities is decentralized. There is, however, still need for the long term integrated planning of generation and transmission capacities at the macro level, since these two sectors must operate in a coordinated manner. This paper presents a model for integrating generation and transmission expansion planning to identify an indicative expansion plan for the total sector at the macro level. The argument for an integrated model is supported using evidence from integrated planning efforts in real life systems. The application of the proposed model is illustrated using an example that requires expansion of generation and transmission capacities over three regions in a deregulated power system. The example considers that addition of generating capacity should come from renewable sources. The test results show the potential cost saving from integrated planning.

Key words： integrated planning; indicative plans; power generation; transmission; deregulation

Acknowledgements

The first author acknowledges to have reviewed the final version of the present paper during his tenure as an assistant professor at Universidad EAN, Colombia.

Appendix: A CHA for integrated planning

Fig.1

References

1 The Minnesota Transmission Owners. Capacity Validation Study. CVS Report. 2009

2 Minnesota Public Utilities Commission. Upper midwest transmission development initiative. Executive Committee Final Report. 2010

3 Unsihuay-Vila C, Marangon-Lima J W, Zambroni de Souza A C, Perez-Arriaga I J. Multistage expansion planning of generation and interconnections with sustainable energy development criteria: A multiobjective model. International Journal of Electrical Power & Energy Systems, 2011, 33(2): 258-270

4 Minnesota Department of Commerce. The next generation renewable energy objective: Minnesota’s smart renewable energy standard. 2007, http://www.state.mn.us/mn/externalDocs/Commerce/The_Next_Generation_Renewable_Energy_Objective_2007_012207111157_REO%20Report2007.pdf

5 Perez-Arriaga I J, Linares P. Markets vs. regulation: A role for indicative energy planning. Energy Journal (Cambridge, Mass.), 2008, 29(01 Special issue): 149-164

6 Gampala K, Ozdamar L, Pokharel S. Investment model for power generation and transmission network expansion in Turkey. Journal of Energy Engineering, 2005, 131(2): 118-138

7 Liu G X, Sasaki H, Yorino N. Application of network topology to long range composite expansion planning of generation and transmission lines. Electric Power Systems Research, 2001, 57(3): 157-162

8 Wen F, David A K. Transmission planning and investment under competitive electricity market environment. In: Proceedings of IEEE Power Engineering Society Summer Meeting. Vancouver, Canada, 2001, 1725-1730

9 Ji X, Wang C. Nash equilibrium in the game of transmission expansion. In: Proceedings of IEEE Region 10 Conference on Computers, Communications, Control and Power Engineering. Beijing, China, 2002, 1768-1771

10 Rocha P, Kuhn D. Multistage stochastic portfolio optimization in deregulated electricity markets using linear decision rules. European Journal of Operational Research, 2012, 216(2): 397-408

11 Green R. Competition in generation: The economic foundations. Proceedings of the IEEE, 2000, 88(2): 128-139

12 White M W, Joskow P L, Hausman J.Power struggles: Explaining deregulatory reforms in electricity markets. Brookings Papers on Economic Activity Microeconomics, 1996, (Special issue): 201-267

13 Jennings D. PowerGen: The development of corporate planning in a privatized utility. Long Range Planning, 2000, 33(2): 201-219

14 Keppo J, Rasanen M. Pricing of electricity tariffs in competitive markets. Energy Economics, 1999, 21(3): 213-223

15 Newbery D M. Problems of liberalising the electricity industry. European Economic Review, 2002, 46(4,5): 919-927

16 Trehan N K. Long-term resource adequacy- supply resources. In: Proceedings IEEE PES Power Systems Conference and Exposition. New York, USA, 2004, 409-412

17 The CapX2020 Utilities. Community based energy development transmission study. CapX C-BED Transmission Study Report. 2007

18 The CapX2020 Utilities. Identifying Minnesota’s electric transmission infrastructure needs. CapX 2020 Technical Update. 2005

19 Bolton P, Farrell J. Decentralization, duplication, and delay. Journal of Political Economy, 1990, 98(4): 803-826

20 Vagstad S. Centralized vs. decentralized procurement: Does dispersed information call for decentralized decision-making? International Journal of Industrial Organization, 2000, 18(6): 949-963

21 Lin W M M, Zhan T S, Tsay M T, Hung W C. The generation expansion planning of the utility in a deregulated environment. In: Proceedings of the IEEE International Conference on Electric Utility Deregulation, Restructuring and Power Technologies. Hong Kong, China, 2004,702-707

22 Kannan S M, Slochanal M M R, Padhy N P. Application and comparison of metaheuristic techniques to generation expansion planning problem. IEEE Transactions on Power Systems, 2005, 20(1): 466-475

23 Lu W, Bompard E, Napoli R, Jiang X C. Heuristic procedures for transmission planning in competitive electricity markets. Electric Power Systems Research, 2007, 77(10): 1337-1348

24 Gallego R A, Monticelli A, Romero R. Comparative studies on non-convex optimization methods for transmission network expansion planning. IEEE Transactions on Power Systems, 1998, 13(3): 822-828

25 Bustamante-Cedeño E, Arora S. Multi-step simultaneous changes constructive heuristic algorithm for transmission network expansion planning. Electric Power Systems Research, 2009, 79(4): 586-594

26 Christie R D, Wollenberg B F Sr, Wangensteen I. Transmission management in the deregulated environment. Proceedings of the IEEE, 2000, 88(2): 170-195

27 Bustamante-Cedeño E, Arora S. Stochastic and minimum regret formulations for transmission network expansion planning under uncertainties. Journal of the Operational Research Society, 2008, 59(11): 1547-1556

28 Morecroft J. Strategic Modelling and Business Dynamics. Chichester: John Wiley & Sons Ltd, 2007