O'Neill, Richard P. | Engineering Papers

DOE OSTI2024

Grid Optimization Competition Challenge 3 Problem Formulation

This report contains the problem formulation for the Grid Optimization (GO) Competition Challenge 3. The Grid Optimization Competition is run by a team of researchers from a number of organizations, including the sponsor Advanced Research Projects Agency - Energy (ARPA-E), lead organization Pacific Northwest National Laboratory (PNNL), and technical contributors from Los Alamos National Laboratory (LANL), National Renewable Energy Laboratory (NREL), Texas A&M University (TAMU), Georgia Institute of Technology (GT), University of Wisconsin (UW), and others. The GO Competition poses challenge problems in the field of power grid management, invites entrants to develop solvers for these problems, invokes the solvers on a set of problem instances using common hardware, ranks the solvers according to their performance, and awards prizes according to the rankings. The overall goal of the GO Competition is to spur innovative research on high impact and computationally challenging problems in power grid management from initial development through commercial deployment. Complete information about the GO Competition can be found online at [2]. The webpage covers previous Challenges, rules, timeline, registration information, data formats, scoring methods, computational platform information, information on supported solvers and languages, sponsor information, frequently asked questions, administrator contact information, publicly available problem instances, computer code for reading and evaluating problem and solution data, a sandbox for testing solvers, and a solver submission interface, results, and publications.

24 POWER TRANSMISSION AND DISTRIBUTION↗

DOE OSTI2024

Average Incremental Cost Pricing for the AC Unit Commitment Problem [Rev. 1]

Unit Commitment (UC) problems that consider the Alternating Current (AC) model of the transmission network have long been considered intractable to solve at scale by the power system community. Recently, the Grid-Optimization (GO) Competition held by the Advanced Research Project Agency-Energy (ARPA-E) has facilitated the development of the first algorithms to solve large-scale ACUC problems. This new capability opens a path towards the explicit consideration of the AC transmission network model in UC problems used to clear day-ahead electricity markets. This calls for the analysis of electricity market structures that accommodate both the continuous non-linearity of the AC transmission network and the discrete non-linearity of the UC problem simultaneously. This paper serves as an initial effort to do so by proposing an Average Incremental Cost (AIC) pricing structure that is designed around the ACUC problem. In particular, an AIC one-pass pricing problem is proposed that represents a continuously constrained variant of the ACUC problem and allows for the computation of Locational Incremental Prices (LIPs) for both real and reactive power as the local optimal Lagrange multipliers of the power balance constraints. To avoid degeneracy, the pricing problem includes a small parameter ϵ > 0. Under certain assumptions market participants are shown to realize profit that converges to a non-negative value as ϵ approaches zero, practically ensuring profitability for small values of ϵ. We additionally provide many simple and important examples that provide intuition and insights into the proposed prices. Examples illustrate the basic concept of AIC pricing, the derived profitability results, the existence of multiple LIPs, the importance of including reactive power in the dispatch and pricing problems, the need for reactive power prices, and the improved incentives exhibited by LIPs as compared to traditional Locational Marginal Prices (LMPs). We additionally indicate many directions for future work including analysis of larger test cases.

29 ENERGY PLANNING, POLICY, AND ECONOMY↗