Market-Based Integrated Generation Expansion Planning of Electric Power System and District Heating Systems

As the primary heat source in the district heating systems (DHSs), combined heat and power (CHP) units are playing an increasingly significant role in electricity generation. Considering that, this paper innovatively proposes an integral generation expansion planning (GEP) framework, which enables competition to occur among conventional power plants (CPPs) of the GENCOs and CHP units of the DHSCOs. The proposed framework is based on decentralized decision-making which involves an iterative process for simulating the interactions of ISO, GENCOs, and DHSCOs. The combined heat and power dispatch model is reconstructed to determine the LMPs to offer incentives for market participants' investments. The fuzzy load duration curve (FLDC) method is proposed to model the electricity load that would influence the LMPs. In each FLDC state, uncertain load is represented by a fuzzy number. Investment decision-making models of the GENCOs and DHSCOs are formulated as a mixed integer linear programming with fuzzy objectives (MILPFO). A technique is proposed to solve the MILPOF models with the consideration of the risk appetite of the market participants. The examples illustrate the benefits of integrated planning of electric power system and DHSs.