Single-Stage vs Multi-Stage Transmission Expansion Planning in Electricity Markets: An MILP Approach

Abstract

This paper analyses the benefit of a multi-stage transmission expansion planning (TEP) over single stage TEP. The paper establishes the conditions (load growth and interest rate) under which the two formulations are equivalent, and when a multi-stage TEP formulation could lead to a better solution. The paper answers an important question of how the planning span shall be divided into stages when going for a multi-stage TEP. The paper further analyses the effect of high peak to average load ratio (PAR) in a multi-stage TEP. The single-stage and multi-stage TEP problems are formulated to minimize the total investment and operation cost over the planning period. The operating cost is calculated by dispatching the generators and loads in a double sided auction market where the supply and demand bids are assumed to be fixed over the planning period. The TEP problem has a mixed integer linear programming (MILP) formulation and is tested on 6 bus Garver System implemented in GAMS.