A novel method for the clearing of a day-ahead electricity market with mixed pricing rules

A novel approach for the clearing of a European-type day-ahead electricity market is presented in this paper. All market products that are currently tradable in European day-ahead electricity markets, namely simple hourly orders, block orders, complex orders and PUN (“Prezzo Unico Nazionale”) orders are incorporated in the model. A one-stage approach is formulated for the efficient handling of the market orders clearing conditions, the non-intuitive bilateral exchanges and the transmission constraints. The clearing conditions of block orders, complex orders and PUN orders are explicitly incorporated in the problem formulating a Mixed Complementarity Problem. The algorithm eliminates possible paradoxically accepted block and non-intuitive bilateral exchanges within an iterative process. The proposed algorithm is evaluated in a simple 14-zone system in terms of solution efficiency and computational requirements.