Mid-term generation scheduling on the basis of a bi-level optimization problem

The electricity generation scheduling is an essential problem in the power system operation. The electricity market creates a specific environment for generation scheduling. The problem should take into account strategic behavior of electricity producers, locational marginal prices and consumers´ demand elasticity. Generation companies aim to maximize their profit. The paper proposes an approach based on a bi-level optimization technique. A statement of a scheduling problem is formulated for the market environment. An algorithm for solving the problem by the bi-level technique is developed. A numerical example for one power system is presented to test the applicability of the technique and algorithm.