Optimal Daily Operation in Smart Grids Using Decentralized Bi-level Optimization Considering Unbalanced Optimal Power Flow

The role of distribution system operators (DSOs) has been changed due to deregulation in the distribution sector of the power systems. In this paper, a bi-level optimization problem is proposed to manage the day-ahead scheduling in an unbalanced distribution system with several micro-grids (MGs) in a decentralized manner. In the proposed framework, at the first level, the micro-grid operators (MGOs) solve their optimization problem to minimize their cost for the next 24 hours independently and send their aggregated demand to the DSO. Then, in the next level of optimization, DSO adjusts the main transformer and capacitor banks' tap position through an optimal power flow (OPF) problem to minimize the power loss with the minimum tap changing. To increase accuracy, the effect of earth is considered in unbalanced optimal power flow equations. To check the effectiveness of the proposed method, a modified unbalanced 13-bus IEEE test system is used as a case study. The results show that with the proposed framework, the MGOs and DSO can cooperate mutually. Also, by adjusting the main transformer and capacitor banks' tap position, the daily power loss is reduced by 30%.