The Application of Optimization Technology for Electricity Market Operation

Abstract

Mathematical optimization provides a formal framework that enables systematic and transparent decision making. Significant progress has been made in recent years in applications of formal optimization techniques for competitive market based resource commitment, scheduling, pricing and dispatch. This paper describes experiences with the application of optimization technology for electricity market operation. Experiences with and the status of the latest development in the security-constrained unit commitment and economic dispatch algorithms are described with references to actual market practices.