Optimal Scheduling of Hydro-Electric Power Generation with Simultaneous Participation in Multiple Markets

This paper presents a stochastic programming framework for solving the optimal scheduling problem faced by a hydro-electric power producer who simultaneously participates in multiple markets. Specifically, the hydro-electric power generator participates in both the electricity spot market and the ancillary services market as a price taker. It seeks to maximize its profit by jointly optimizing its power sales and scheduling into all markets subject to market uncertainties and operational constraints. The impact of market uncertainties on the co-optimization problem over a pre-specified time horizon is examined through a stochastic programming formulation incorporating both market participation and market price uncertainties. Numerical studies on the advantages of the proposed stochastic co-optimization strategy for a hydro-generator for hedging market uncertainties are carried out in a realistic case study. The proposed model can also be directly adapted for determining the optimal scheduling and bidding strategy for a power producer subject to additional types of market and operational uncertainties