A pricing model considering the simultaneous interaction of pool, conventional and alternative markets in a power system is presented. This work inserts a competition for alternative power plants separating the pricing for these three markets. The model use the ‘Pay-as-Bid’ (PAB) pricing approach in opposite of classical marginal pricing (MP) approach because the inelastic demand characteristic and the necessity of reduce total operation cost. In the model pricing approach, an integration process involves an AC Optimal Power Flow (OPF) for obtaining awarded bids in the pool and market with the presence of conventional or alternative energy bilateral contracts. As a result, the obtained prices of pool, conventional and alternative energy incorporate the influences of the topology, voltage levels, losses and capacity limits of generators and transmission lines. Results show that agents can plan their portfolios based on reasonable stable prices that reflect the impact of supplying several electricity types and associated costs of resources in several operation scenarios and bid strategies. From the perspective of the system regulator, the minimization of payments by PAB ensures the supply of energy, transmission losses and alternative energy requirements as well as enforcing financial adequacy. Numerical cases are presented for evaluating the model
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