Stochastic network investment in integrated gas-electric systems

Abstract

Power and gas systems are large interdependent infrastructures because of gas-fired power production facilities. This study presents a transmission expansion planning model considering the interaction between power and gas markets in a bi-level structure. The transmission investment decisions are made in the upper level power market problem considering the construction and operating costs. The lower level problem clears the gas market and determines demand and supply quantities of gas-fired units and of gas wells using a mixed integer linear program. The uncertainty of gas and power demands in both markets are considered using a scenario-based approach. A stochastic bilevel mixed integer optimization program is thus developed which is computed in an exact fashion by applying a customized reformulation-decomposition method. An example system and a test system are provided to illustrate the application of the proposed scheme.