A game-theoretic study of the strategic interaction between generation and transmission expansion planning

Due to the unbundling of power generation and transmission in the restructured power system, the generation expansion planning (GEP) and transmission expansion planning (TEP) are decided by independent entities. The coordination of GEP and TEP therefore becomes a new challenge for both generation companies (GenCos) and transmission companies (TransCo). In this paper, a single-stage deterministic model is proposed to study the strategic interaction between GenCo and TransCo. Cournot model is used to simulate the expansion behaviors for both GenCo and TransCo. The equilibrium is obtained using the mixed complementarity problem approach. The proposed model is applied to a three-bus system and the IEEE 14-bus system.