Strategic generation expansion planning considering prohibited operating zones: a game-theoretic analysis

Generation expansion planning (GEP) is a pivotal problem for power system planners due to increasing electric power consumption. This article aims to construct a methodology for GEP in power networks while incorporating the prohibited operating zones (POZ) and multi-fuel option (MFO) into the problem. The POZ and MFO are not considered in the existing GEP models, whereas these factors might considerably change the optimal planning scheme. A decentralized framework that relies on a generalized Nash equilibrium problem (GNEP) is considered in this paper, where several rival generation companies (Gencos) compete with each other to specify their own optimal decisions. Due to modeling the POZ and MFO in the GEP problem, integer variables are introduced, leading to a discretely constrained GNEP (DC-GNEP). Employing Karush-Kuhn-Tucker (KKT) optimality conditions, the DC-GNEP is recast as mixed-integer linear programming, which commercial branch-and-cut solvers can efficiently solve. Numerical experiments are performed on the IEEE 118-bus system to analyze and compare optimal GEP solutions. The numerical results point to the effectiveness of the proposed model considering POZ and MFO.