Firefly algorithm based optimization of Strategic bidding to maximize Profit and Benefit of Competitive Electricity market

Abstract

The reconstruction of electric power industry may have significant effect on issues pertaining to economic and reliable operation of electric power system. Generation companies and large consumers are experiencing a different task of designing the proper handling methodologies. Therefore the systematic development of optimal bidding strategy becomes a major concern of Generation companies and power consumers.  In this paper an innovative approach for defining optimal bidding strategy is presented as a multi objective stochastic optimization problem and solved by Firefly algorithm (FA). The Firefly Algorithm is a Meta heuristic, nature inspired, optimization algorithm which is based on the social flashing behavior of fireflies and has been introduced for the bidding problem to obtain the global optimal solution. The proposed Firefly algorithm effectively maximizes the GENCOs profit and benefit of large consumers. A numerical example with six suppliers and two large consumers is considered to illustrate the salient features of the proposed method and test results are presented. The simulation result shows that these approaches effectively maximize the Profit and Benefit of Power suppliers and Large Consumers, converge much faster and more reliable when compared with available methods.
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