Power Plant Bidding Strategy In The Electricity Market

Electricity marketing is the inevitable trend of electrical industry in developing. It results in the change of the conventional property structure of power system, and it causes a series of new technique problems. The paper focus on generator's bidding problem in electrical power market. First, the mechanism of day-ahead power exchange market is introduced. Several bidding thoughts of generators and a bidding method based on game theory are introduced. Then bidding curve is discussed, several kinds of bidding curve and its related factors are analyzed. The basic bidding strategies are also analyzed by mathematics tool and several main characteristics of bidding are revealed. The derived result indicates that bidders have incentives to mark up their bids above their cost of production. The amount of markup depends on the probability of winning below and on the margin that are computed from the cost distribution of all suppliers, market demand, and the number of suppliers participating in the auction. The stochastic optimization method is brought forward, which makes a great amount of simulation of other bidder's biding in electrical market, as for every simulation, genetic algorithm is applied to solve the optimization problem, in consideration of the restraint of direct current network, one optimal bid is got, then using the average optimal bids in a great number of simulations as the last optimal bids. The program using C++ Language of this method is programmed and examples are discussed for simulation, examples prove the bidding method's validity.