The equilibrium model of electricity market considering green certificate trading

With the rapid development of electricity market reform and renewable energy in China, the trading system of green certificate based on Renewable Portfolio Standard (RPS) will be established in China. An equilibrium model of multi-periods electricity market considering green certificate trading is proposed in this paper, in which GenCos' (Generation Companies') strategic bidding behaviors are properly modeled using Cournot model and the transmission limit constraints, the renewable energy ratio constraints and the unit ramp rate constraints are simultaneously considered. Moreover, the nodal price is also decomposed into five components, including the unit marginal cost, the green certificate marginal cost and so on. As illustrated by the numerical tests, in order to reduce the cost of the system, the output of renewable energy unit in peak load periods is often greater than the required green certificate quota at the same time, and vice versa in valley load periods. In imperfectly competitive environment, the GenCo owning thermal units and renewable energy units may manipulate the nodal price and green certificate price simultaneously to earn higher profit.