A fuzzy long-term investment planning model for a GenCo in a hybrid electricity market considering climate change impacts

Berna Tektas Sivrikaya; Ferhan Cebi; Hasan Hüseyin Turan; Nihat Kasap; Dursun Delen

doi:10.1007/s10796-016-9707-1

A fuzzy long-term investment planning model for a GenCo in a hybrid electricity market considering climate change impacts

Berna Tektas Sivrikaya
, Ferhan Cebi
, Hasan Hüseyin Turan
, Nihat Kasap
, Dursun Delen^*

^*Corresponding author for this work

Department of Management Engineering

Uludag University
Department of Mechanical and Industrial Engineering
Sabanci University
Oklahoma State University

Research output: Contribution to journal › Article › peer-review

8 Citations (Scopus)

Abstract

We study the long-term generation capacity investment problem of an independent power generation company (GenCo) that functions in an environment where GenCos perform business with both bilateral contracts (BC) and transactions in the day-ahead market (DAM). A fuzzy mixed integer linear programming model with a fuzzy objective and fuzzy constraints is developed to incorporate the impacts of imprecision/uncertainty in the economic environment on the calculation of the optimal value of the GenCo’s objective function. In formulating the fuzzy objective function we also include the potential impacts of climate change on the energy output of hydroelectric power plants. In addition to formulating and solving the capacity planning/investment problem, we also performed scenario-based (sensitivity) analysis to explore how investment decisions of the GenCos change when fuzziness (tolerance) in the maximum energy output of hydroelectric units and/or drought expectation increases. The proposed model is novel and investigates the effects of factors like drought expectations of climate changes, hydroelectric power plant investments, and other power generation technology investment options.

Original language	English
Pages (from-to)	975-991
Number of pages	17
Journal	Information Systems Frontiers
Volume	19
Issue number	5
DOIs	https://doi.org/10.1007/s10796-016-9707-1
Publication status	Published - 1 Oct 2017

Bibliographical note

Publisher Copyright:
© 2016, Springer Science+Business Media New York.

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 7 Affordable and Clean Energy
SDG 8 Decent Work and Economic Growth
SDG 13 Climate Action

Keywords

Long-term capacity planning
bilateral contracts market
climate change
day-ahead market
energy generation
fuzzy programming
hydroelectric power

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10.1007/s10796-016-9707-1

Cite this

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abstract = "We study the long-term generation capacity investment problem of an independent power generation company (GenCo) that functions in an environment where GenCos perform business with both bilateral contracts (BC) and transactions in the day-ahead market (DAM). A fuzzy mixed integer linear programming model with a fuzzy objective and fuzzy constraints is developed to incorporate the impacts of imprecision/uncertainty in the economic environment on the calculation of the optimal value of the GenCo{\textquoteright}s objective function. In formulating the fuzzy objective function we also include the potential impacts of climate change on the energy output of hydroelectric power plants. In addition to formulating and solving the capacity planning/investment problem, we also performed scenario-based (sensitivity) analysis to explore how investment decisions of the GenCos change when fuzziness (tolerance) in the maximum energy output of hydroelectric units and/or drought expectation increases. The proposed model is novel and investigates the effects of factors like drought expectations of climate changes, hydroelectric power plant investments, and other power generation technology investment options.",

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AU - Kasap, Nihat

AU - Delen, Dursun

PY - 2017/10/1

Y1 - 2017/10/1

N2 - We study the long-term generation capacity investment problem of an independent power generation company (GenCo) that functions in an environment where GenCos perform business with both bilateral contracts (BC) and transactions in the day-ahead market (DAM). A fuzzy mixed integer linear programming model with a fuzzy objective and fuzzy constraints is developed to incorporate the impacts of imprecision/uncertainty in the economic environment on the calculation of the optimal value of the GenCo’s objective function. In formulating the fuzzy objective function we also include the potential impacts of climate change on the energy output of hydroelectric power plants. In addition to formulating and solving the capacity planning/investment problem, we also performed scenario-based (sensitivity) analysis to explore how investment decisions of the GenCos change when fuzziness (tolerance) in the maximum energy output of hydroelectric units and/or drought expectation increases. The proposed model is novel and investigates the effects of factors like drought expectations of climate changes, hydroelectric power plant investments, and other power generation technology investment options.

AB - We study the long-term generation capacity investment problem of an independent power generation company (GenCo) that functions in an environment where GenCos perform business with both bilateral contracts (BC) and transactions in the day-ahead market (DAM). A fuzzy mixed integer linear programming model with a fuzzy objective and fuzzy constraints is developed to incorporate the impacts of imprecision/uncertainty in the economic environment on the calculation of the optimal value of the GenCo’s objective function. In formulating the fuzzy objective function we also include the potential impacts of climate change on the energy output of hydroelectric power plants. In addition to formulating and solving the capacity planning/investment problem, we also performed scenario-based (sensitivity) analysis to explore how investment decisions of the GenCos change when fuzziness (tolerance) in the maximum energy output of hydroelectric units and/or drought expectation increases. The proposed model is novel and investigates the effects of factors like drought expectations of climate changes, hydroelectric power plant investments, and other power generation technology investment options.

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KW - bilateral contracts market

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KW - day-ahead market

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KW - hydroelectric power

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A fuzzy long-term investment planning model for a GenCo in a hybrid electricity market considering climate change impacts

Abstract

Bibliographical note

UN SDGs

Keywords

Access to Document

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