Hierarchical Decentralized Optimization Architecture for Economic Dispatch: A New Approach for Large-Scale Power System

In this paper, a new hierarchical decentralized optimization architecture is proposed to solve the economic dispatch problem for a large-scale power system. Conventionally, such a problem is solved in a centralized way, which is usually inflexible and costly in computation. In contrast to centralized algorithms, in this paper we decompose the centralized problem into local problems. Each local generator only solves its own problem iteratively, based on its own cost function and generation constraint. An extra coordinator agent is employed to coordinate all the local generator agents. Besides, it also takes responsibility to handle the global demand supply constraint based on a newly proposed concept named virtual agent. In this way, different from existing distributed algorithms, the global demand supply constraint and local generation constraints are handled separately, which would greatly reduce the computational complexity. In addition, as only local individual estimate is exchanged between the local agent and the coordinator agent, the communication burden is reduced and the information privacy is also protected. It is theoretically shown that under proposed hierarchical decentralized optimization architecture, each local generator agent can obtain the optimal solution in a decentralized fashion. Several case studies implemented on the IEEE 30-bus and the IEEE 118-bus are discussed and tested to validate the proposed method.