Transmission investment decision analysis using fuzzy binomial tree

The abundant market participants and transactions, as well as the flexibility of the power system planning and operation make tremendous challenges to the transmission investment. According to the real-option characteristics of transmission investment, the framework of the transmission investment decision is given. Then the market-clearing midel is bulit to realize the most efficient operation of the power market. To reduce the impact of the uncertainty of the price fluctuations, the fuzzy binomial tree model is given and applied to the evaluation of the option value. Take the IEEE-7 system as an example, the three cases, such as the respectively investment of the lines, and both of them, is analysised and compared. And the results verify the rationality and efficiency of the models.