Composite generation and transmission planning in a competitive environment

In a deregulated power system, generation companies would like to maximize their profits and share of the electricity market. This can only be achieved if transmission access and network availability is satisfactory. New mathematical models for generation and transmission planning are thus needed. The problem is divided into two sub-problems of generation and transmission. The two sub-problems will then be combined to provide a composite solution. The generation sub-problem considers investment costs, fuel cost, operation and maintenance costs, generation limits, and limits on unserved energy. The transmission sub-problem takes into consideration power flow, cost of adding lines, number of circuits in a route. The transmission sub-problem is formulated as a mixed integer optimization problem. The developed algorithms were solved using Branch and Bound method. The transmission sub-problem was solved through DC power flow based on a successive backward method. This was tested on two systems including an artificial an IPP seeking an appropriate location. The results provide a location for the IPP with sufficient transmission access and at the same time minimized the overall costs.