Market-Based Wind Power Generation Expansion Planning Based on Cost Minimization

Variable renewable generation has been added to the generation mix of the modern power grid to meet the ever-increasing load demand while also adhering to environmental preservation requirements. However, given that these renewable energy sources are intermittent and dependent on unpredictable environmental conditions, the dynamics and priorities of generation expansion planning require thorough adjustments and refinements. The primary aim of this research paper is to develop a Generation Expansion Planning (GEP) model that minimizes the installation and operation costs of vertically integrated utilities connected to the electric market considering the wind power resources. Also, the reliability index is included so that the system keeps the loss of load expectation (LOLE) at an acceptable level during operation. This is achieved by considering the reliability data of conventional generators, such as the force outage rate (FORs) for each generator so that a Capacity Outage Probability Table (COPT) for each area will be calculated to control the market trading by keeping LOLE within a certain acceptable level.The proposed methodology is assessed and confirmed using a multi-area power system, where each area is equipped with conventional power generation systems and characterized by its load profile. These regions are interconnected via a tie-line. This research paper contributes to sustainable energy planning by offering a comprehensive framework considering cost reduction, Loss of Load Expectation (LOLE), and optimal wind power allocation. This study concluded that the optimal allocation of wind power has a significant impact on the reliability of electric power systems. Additionally, the study showed that market mechanisms influence decisions regarding capacity addition, pricing, and the overall economics of power generation.