Bidding Strategy for Power Generation Enterprises as Price Makers in Day-ahead Energy and Regulation Markets

Abstract

As high-level renewable energy integration imposes significant uncertainties into power systems, the ancillary market has emerged to mitigate unbalance through market-based mechanism. The thermal generators are transmitting from benchmark suppliers to adjustable suppliers, which means how to allocate capacities for energy and ancillary market is crucial for revenues. This paper is focused on the bidding strategy of power generation enterprises as price-makers in day-ahead energy and regulation markets. A two level bidding strategy model is proposed where power generation enterprises maximizes the profits by strategic bids subject to system operator minimizes power supply costs. The proposed strategic bidding model are transformed into a computationally tractable mixed integer linear programming problem by Karush-Kuhn-Tucker conditions, which can be solved by mature commercial solvers. The proposed technique is able to provide bidding strategies for price makers in provincial energy and ancillary markets.