Available transfer capability evaluation in a deregulated electricity market considering correlated wind power

Evaluation of available transfer capability (ATC) is a complicated process involving the determination of the total transfer capability (TTC) and the existing transfer commitments (ETC). Considering the uncertain renewable generation such as wind power will bring more challenge to this process. Previously the uncertainty of wind power is considered either in the ED model or the following TTC calculation, but not included in two process simultaneously. Therefore, the ATC output may not be accurate since the uncertainty impact two problem simultaneously. To consider the uncertainty and correlation of wind power in both ISO's ED and ATC evaluation, this paper proposes a bi-level optimization framework in which the ATC evaluation is formulated as the upper level problem and the ED is the lower level. The bi-level model is first converted to a mathematic program with equilibrium constraints (MPEC) by recasting the lower level problem as its Karush-Kuhn-Tucker (KKT) optimality conditions, and then transformed to a mixed-integer linear programming (MILP) problem which can be solved by existing optimization tools. Case studies on the PJM 5-bus and IEEE 118-bus systems are presented to verify the proposed methodology and the impacts of correlation of wind power on ATC are analysed.