A nationwide multi-location multi-resource stochastic programming based energy planning framework

Abstract

With the escalating global energy demands, nations face greater urgency in diversifying their electricity market portfolio with various energy sources. The efficient utilization of these fuel resources necessitates the integrated optimization of the entire energy portfolio. However, the inherent uncertainty of variable renewable energy generators renders traditional deterministic planning models ineffective. Conversely, expansive stochastic models that capture all the complexities of the power generation problem are often computationally intractable. This paper introduces a scalable energy planning framework tailored for policymakers, which is adaptable to diverse geopolitical contexts, including individual countries, regions, or coalitions formed through energy trade agreements. A two-stage stochastic programming approach, including a scenario-based Benders decomposition method, is employed to achieve computational efficiency. Scenarios for representing parameter uncertainty are developed using a k-means clustering algorithm. An illustrative case study is presented to show the practical application of the proposed framework and its ability to inform policymaking by identifying actionable cost-reduction strategies. The findings underscore the importance of promoting resource coordination and demonstrate the impact of increasing interchange and renewable energy capacity on overall gains. Notably, the study shows the superiority of stochastic optimization over deterministic models in energy planning.