Optimal Bidding Curves for an Energy Service Provider in Iran Electricity Market

Abstract-- During the last few years in the competitive energy market, participants have used stochastic programming based asset allocation models in their processes. In the demand side of electricity market, the customers ’ behavior will be stochastic, so the actual consumption load is random. Therefore we can suppose that all decisions about load price and volume hold a certain amount of uncertainty. In this paper we present an approach for solving a stochastic linear programming model and then drawing bidding curves for an energy service provider. This approach is independent to large amount of historical information about the most relevant market variables and variables related to bidding or behavior of the other market participants, where an optimization process finds the optimal bid curve for the given prices and a single hour, by using the output of the scenario generation algorithm and the GAMS software. The model is illustrated using a case study with data from Iran electricity market and the results show that the proposed algorithm is efficient and satisfactory bidding curves are obtained. Index Terms-- Demand side bidding, scenario tree generation, stochastic optimization 1