Branch and Bound Approach to the Solution of the Linear Supply Function Equilibrium Model in Presence of Network Constraints

In the computing process of the linear supply function equilibrium,it frequently requires to solve bi-level optimization problems faced by each generation company(GenCo).A new approach adopting the branch and bound technique is proposed to compute the equilibrium point of the linear supply function model in presence of transmission constraints.This approach deals with the complementarity slack constraints by branching and pruning,and can verify all the slack sub-modes by computing a few sub-optmization problems.As illustrated by the 3-bus system and the IEEE 30-bus system,the proposed method has good search performance and provides an efficient way to compute the equilibrium solution for electricity markets.