Optimal Operation of a Disco in Competitive Electricity Markets with Elasticity Effects

This paper presents the operations planning activities of a disco operating in a competitive electricity market environment. The disco responds to real-time changes in electricity market prices to optimally manage and supply the hourly customer demand based on an appropriate economic criterion while incorporating technical constraints. An operation planning model is presented in the paper, which aims to minimize the total disco operational costs taking into account the price fluctuations. The model uses an optimum power flow from the disco perspective to find the optimum operational decisions where different resources become available. A novel feature of this work is the adoption of a price elasticity to demand function of the disco based on historical data trend to examine how its operational decisions are affected in the context of electricity market dynamics. Case study with a simple distribution system is presented and different operational scenarios are demonstrated.