Overview on Economic Operations in the Power

System
Professor: Edward I. Olmedo
 Generator Cost Function
o Generator costs are represented using
quadratic functions

 Losses are Quadratic

o Remember the formula for MW losses is I2R

 Power Flow Equations are Not Linear

 Optimal Power Flow in Economic Operations is

a “math problem”
 One of the objective of power system planners and
operators is to minimize the cost of operating a power
system
 A power system is composed of the following
components
o Generators
o Customer Feeders / Loads
o Transmission Lines
o Transformers
o Shunt Capacitors
o Shunt Reactors
o Breakers
o Synchronous condensers
o And more…
 Generating units have the major contribution
in operating costs since fuel is needed
o Fuel can be coal, natural gas, diesel/oil, etc.
o Fuel prices are volatile and dictated by
market forces
o Although hydro plants are cheaper, its
availability is inferior than those plants that
utilizes conventional fuel
Main Objective
 Optimize controllable power system variables
to achieve a desired objective

 Most optimization objectives involve

o Minimize generator operating cost
o Minimize copper loss (I2R)
o Optimize transmission/distribution
configuration
Controllable Variables
 Generator Active Power Output: MW
 Generator Reactive Power Output: MVAR
 Power system configuration through breaker
configuration
 Status of power system components: ON/OFF
What is Optimization?
 As defined, it is “the action of making the best
or most effective use of a situation or
resource”
 In mathematical equations:
o This means solving problems in which one
seeks to minimize or maximize a real
function by systematically choosing the
values of real or integer variables from within
an allowed set
o “Brute-force” method can be used to find the
optimal solution to a problem, however, it is
not appropriate for large-scale and realistic
system
Optimization Techniques
 Conventional Methods
o Unconstrained Optimization
o Nonlinear Programming (NLP)
o Linear Programming (LP)
o Quadratic Programming (QP)
o Generalized Reduced Gradient Method
o Newton Method
o Network Flow Programming (NFP)
o Mixed Integer Programming (MIP)
o Interior Point Programming
Optimization Techniques
 Intelligent Methods
o Artificial Neural Network
o Evolutionary Programming
o Particle Swarm Optimization

 Probabilistic Optimization
o Probabilistic Optimization
o Fuzzy Set
o Analytic Hierarchal Process
Conventional Methods - Unconstrained
 Serves as basis for constrained optimization
formulation
 No constraints i.e. transmission limit,
generator limit
 Approaches gradient method, line search,
Lagrange multiplier method
Linear Programming
 It is simpler to solve linear equations

 The power system problem is “linearizes” nonlinear equations

o Has two major components:
 Objective
 Constraints

 Has reliable convergence

 Very easy to formulate and very fast once linearization is

performed
 But due to this linearization, some nonlinear properties
introduce approximation inaccuracies (e.g. line losses)
 Nevertheless, its precision is generally acceptable for most
applications
 The Philippine Wholesale Electricity Spot Market uses Linear
Programming solution to optimize schedules and derive
process
Non-Linear Programming
 Handles non-linear equations in the problem solution
 Requires a good approximation of a starting point to
start (aids in finding the global extreme points)
 More accurate than LP since little or no information is
lost
 Generally slower than LP
 More complicated to formulate
End of Presentation