Optimal self-scheduling of a dominant power company in electricity markets

This paper addresses the problem of the self-scheduling of a power company with a dominant role in both the production and retail sectors of an electricity market. An integrated 0/1 mixed integer linear programming (MILP) formulation is provided, which combines both thermal and hydro subsystems in a single portfolio for a dominant power company through a detailed modeling of the operating constraints of thermal units and hydroplants. Residual demand curves for energy and reserves are used to model the effect of the power company's interactions with its competitors. Test results on a medium-scale real test system address the effect that the power company's forward commitments and the market rules have on its daily self-scheduling and profits as well as on the resulting energy and reserve market clearing prices. (C) 2012 Elsevier Ltd. All rights reserved.