A new Lagrangian decomposition and coordination approach for energy portfolio and production planning for multiple companies

The energy portfolio and production planning problem for multiple companies under energy constraints is formulated as a mixed integer nonlinear programming problem. A new Lagrangian decomposition and coordination approach is proposed to solve the problem effectively. In this paper, we propose efficient computation algorithms for lower bound and upper bound. The lower bound is computed by relaxing the nonlinear term in the objective function. The upper bound is derived by Lagrangian relax and fix heuristic that successively fixes the solution of subproblems to create a feasible solution. Computational results show that the proposed method can effectively solve the problem compared with conventional Lagrangian decomposition and coordination method.