Abstract
This paper considers a distribution company (Disco) that trades electricity energy in the day-ahead electricity market. It is considered that Discos have distributed generations (DGs) and interruptible loads (ILs). Also, this paper provides a procedure to derive the optimal energy acquisition strategies for maximizing its profit while supplying its end consumers’ energy requirements. The proposed procedure to derive energy acquisition strategic relies on a bi-level programming model whose upper-level problem represents the profit maximization of the Discos while the lower-level one represents the system operating cost minimization. The bi-level model is reduced to a mathematical program with equilibrium constraints (MPEC) model using Karush–Kuhn–Tucker optimality conditions. In MPEC model, the complementarity constraints are nonlinear. Therefore, these nonlinear constraints are converted to mixed-integer linear constraints using the strong duality theory solvable using CPLEX solver on GAMS optimization software. Results from an illustrative example are reported and discussed.
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