Maximizing Profit of a Wind Genco Considering Geographical Diversity of Wind Farms

Abstract

Uncertainty and geographical diversity of wind speeds create risk for a wind power generation company (WGenco) to make the maximum profit from power market trading. A probabilistic approach is proposed to estimate the profit of a WGenco considering geographical diversity and uncertainty of wind speeds and market prices. The objective of the optimization problem is to assist a WGenco to do the optimal bidding in market trading in order to make the maximum profit under various market and wind speed uncertainties. The point estimate method (PEM) has been improved to facilitate stochastic modeling of the aggregated power output of wind turbine generators in different locations in the problem formulation. The principal component analysis (PCA) is used to manage correlated wind speeds.