Nodal pricing exercise

For the above system:

(a) Determine the economic dispatch assuming there are no transmission
constraints
(b) Determine the system marginal price
(c) Determine the constrained economic dispatch based on the given line
parameters and capacities
(d) Identify overloaded lines
(e) Correct the overloads by re-dispatching generation in the most economic
fashion
(f) Compute the nodal prices for the constrained system
(g) Compute the congestion cost
(h) Finally, for case (c) write the equations for the objective function and the
constraints that you would need to solve using optimisation techniques to find
the dispatch and nodal prices
(i) Solve the problem in (h) using an optimisation routine (in MATLAB, EXCEL
etc) and compare your results with what you found in (c) and (f)
Nodal pricing exercise
Solution
(a) Determine the economic dispatch assuming there are no transmission constraints
Since the marginal costs are constant, the generators are dispatched starting with
the least marginal cost until the load is met.
Generator Node Cost
($/MWh)
Capacity
(MW)
Dispatch
(MW)
Demand
(MW)
GA 1 8 140 140 50
GB 1 10 285 270
GC 2 20 90 0 60
GD 3 15 85 0 300
Total 410MW 410MW
(b) Determine the system marginal price
The system marginal price is $10/MWh (From the most expensive partially
loaded generator)
(c) Determine the constrained economic dispatch based on the given line parameters
and capacities
The line flows are determined from Kirchhoffs voltage (KVL) and nodal balance
(KCL) equations
Figure 1
KCL equations
Node 1: GA + GB F1 F3 50 = 0 (1)
Node 1: GC + F2 F1 60 = 0 (2)
Node 1: GD + F3 + F2 300 = 0 (3)
One loop hence one KLV equation
KVL: 0.2*F1 + 0.1*F2 0.2*F3 = 0 (4)
Substituting for known variables, we have;
Nodal pricing exercise
Node 1: 360 F1 F3 = 0 (5)
Node 1: F2 F1 60 = 0 (6)
Node 1: F3 + F2 300 = 0 (7)
From (5), F1 = 360 F3 (8)
From (4) F1 = (0.1*F2 0.2*F3)/0.2 = 0.5F2 + F3 (9)
Equating (8) and (9); 360 F3 = 0.5F2 + F3 (10)
From (10), 2F3 0.5F2 = 360 (11)
Multiply (7) by 2
2*(F3 + F2) = 2*(300) 2F3 2F2 = 600 (12)
Add (12) and (11) to give
2.5F2 = 240; giving
F2=240/2.5 = 96MW
Therefore F3 and F1 can be computed from (7) and (5) respectively
F3=300-F2=300-96=204MW
F1=360-F3= 360-204=156MW
(d) Identify overloaded lines
From line capacities line 1-2 is overloaded since it is rated at 120MW and the
flow is 156MW
(e) Correct the overloads by re-dispatching generation in the most economic fashion
The overload in line 1-2 can be corrected by re-dispatching either GD or GC.
Check each one in turn and compare the costs to choose the most economic
solution.
Case 1 Use GD to reduce flow in line 1-2 by 36MW to 120MW the rated line
capacity.
Figure 2
For the above scenario we will have
Y = F3 + F2
Nodal pricing exercise
, )
, )
MW Y
Y F F
90 5 18
2 . 0
5 . 0
36
36
2 . 0 1 . 0 2 . 0
2 . 0
2 1
= - = - =
=
+ +
- = =
Cost of re-dispatch = 90*15= 135
Case 2 Use GC to reduce flow in line 1-2 by 36MW to 120MW the rated line
capacity:
Figure 3
, )
, )
MW X
X F
60 5 12
3 . 0
5 . 0
36
36
2 . 0 1 . 0 2 . 0
1 . 0 2 . 0
1
= - = - =
=
+ +
+
- =
Table 1
Marginal
Cost
/MWh
Unconstrained
Economic
dispatch
Case 1
constrained
dispatch
Case 2
constrained
dispatch
GA 8 140 140 140
GB 10 270 180 210
GC 20 0 0 60
GD 15 0 90 0
Total(MW) 410 410 410
Cost ($) 3,820 4,270 4,420
Cost of
constraints
($) 0 450 600
The most economic way to eliminate the constraint online 1-2 would be to use
case 1. However GD capacity is limited to 85MW hence some use would have to
be made of generator GC.
Hence with GD output equal to 85 the line 1-2 will still be overloaded by:
MW 2 34 36
5 . 0
2 . 0
85 36 = = -
Hence we need to dispatch generator GC by:
Nodal pricing exercise
, )
, )
MW X
X F
33 . 3
3 . 0
5 . 0
2
2
2 . 0 1 . 0 2 . 0
1 . 0 2 . 0
1
= - =
=
+ +
+
- =
dispatch would be
Hence final dispatch will be as shown in Table 2 below
Table 2
Marginal
Cost
/MWh
(A)
Unconstrained
Economic
dispatch
(B)
Case 1
constrained
dispatch
GA 8 140 140
GB 10 270 181.67
GC 20 0 3.33
GD 15 0 85
Total(MW) 410 410
Cost ($) 3,820 4,278
Cost of
constraints
($) = (B)-
(A) 0 458
(f) Compute the nodal prices for the constrained system
Due to line 1-2 being congested, the nodal prices will be different at each node.
Node 1:
The nodal price at node 1 is equal to 10$/MWh because generator GB is not fully
loaded and hence the next MW at this node will be supplied by GB
Node 2:
The generator GC at node 2 is also not fully loaded and hence the next MW
demand at this node will be supplied from this node. Therefore the nodal price at
this node is 20$/MWh
Node 3:
Since the generator at node 3 is fully loaded, the next MW demand at this node
must be supplied from node 1 and node 2. Hence the nodal price is found as a
linear combination of the nodal prices at nodes 1 and 2.
Nodal pricing exercise
Figure 4
Figure 5
From Figure 4 and Figure 5, compute nodal prices as follows:
0 2 . 0 4 . 0
1
12 2 1
2 1
= A = A A
= A + A
F P P
MW P P
2
2
1
2 1
5 . 0
4 . 0
2 . 0
2 . 0 4 . 0
P
P
P
P P
A =
A
= A
A = A
MW P
MW P
P
P P P
3
1
3
2
5 . 1
1
1 ) 5 . 0 1 (
5 . 0 1 1
1
2
2
2 1 2
= A
= = A
= + A
A = A = A
Therefore; the nodal price for node 3 is:
MWh MC
MC P MC P MC
/ $ 67 . 16
3
50
20
3
2
10
3
1
3
2 2 1 1 3
= = - + - =
A + A =
(g) Compute the congestion cost
Congestion is given from final dispatch table 2 as $458
(h) Finally, for case (c) write the equations for the objective function and the
constraints that you would need to solve using optimisation techniques to find the
dispatch and nodal prices
Nodal pricing exercise
Figure 6
(a) Objective function
i
Ng
i
T
i
G C Min

=1
= GD GC GB GA Min 15 20 10 8 : + + +
where Ng is the number of generators
Subject to the following constraints:
(b) KCL equations
0 300 3 2
0 60 2 1
0 50 3 1
= + +
= +
= +
F F GD
F F GC
F F GB GA
(c) KVL equation
0 3 2 . 0 2 1 . 0 1 2 . 0 = + F F F
(d) Generator limits
85 0
90 0
285 0
140 0
s s
s s
s s
s s
GD
GC
GB
GA
(e) Line flow limits
250 3 250
130 2 130
120 1 120
s s
s s
s s
F
F
F
(i) Solve the problem in (h) using an optimisation routine (in MATLAB, EXCEL etc)
and compare your results with what you found in (c) and (f)
Nodal pricing exercise
Result from Excel
Microsoft Excel 11.0 Sensitivity Report
Worksheet: [Solver.xls]Sheet2
Report Created: 31/12/2011 02:09:20
Adjustable Cells
Final Reduced
Cell Name Value Gradient
$F$3 GA solution 140 -2
$F$4 GB solution 181.6666667 0
$F$5 GC solution 3.333333333 0
$F$6 GD solution 85 -1.666666667
$F$9 F1 solution 120 -16.66666667
$F$10 F2 solution 63.33333333 0
$F$11 F3 solution 151.6666667 0
Constraints
Final Lagrange
Cell Name Value Multiplier
$C$14 KCL1 min -5.68434E-14 10
$C$15 KCL2 min 0 20 Nodal Prices
$C$16 KCL3 min 0 16.66666667
$C$17 KVL min 0 33.33333284