EPEC approach for finding optimal day-ahead bidding strategy equilibria of multi-microgrids in active distribution networks

Abstract

In this paper, an equilibrium model is proposed to model the operation of a distribution network (DN) consisting of distributed energy resources (DERs) and multi-microgrids (MMGs) with storage devices. The aim is to find equilibria among microgrids (MGs) which are bidding/offering strategically to buy/sell power from/to the DN in a day-ahead market. For finding such equilibria, a bilevel model is proposed in which the bidding problems of the MGs are defined at the upper level, constrained at the lower level by the distribution network operator (DNO) objective function subject to technical constraints. This bilevel model of each MG is transformed into a mathematical program with equilibrium constraints (MPEC). The aggregated solutions of all MPECs form an equilibrium problem with equilibrium constraints (EPEC). The solutions of this EPEC are analyzed through a diagonalization method to identify meaningful Nash equilibria. Different case studies are carried out to find equilibrium in an illustrative test case based on the IEEE 33-node network. An extensive battery of numerical simulations suggests that the progressive installation of storage devices and the possibility of load curtailment by MG have a strong impact on the market equilibrium and on the operation costs of the DN.