Strategic bidding and generation scheduling in electricity spot-markets

This paper presents a short-term generation scheduling model applicable to independent power producers participating in electricity spot-markets. The model combines unit commitment, generation scheduling and spot-market buy-sell decisions in a common profit-maximizing framework. A scheme is proposed thereafter to determine the optimum bid prices for each hour by maximizing the probability of a bid being cleared and of accruing positive returns from the market. The IEEE Reliability Test System is modified and adopted to represent an example IPP. Six distinct bidding strategies dependent on IPP's marginal cost and expected spot market price emerge from the studies.