Agent-Based Modeling for Studying the Impact of Capacity Mechanisms on Generation Expansion in Liberalized Electricity Market

Authored by N Y Dahlan

Date Published: 2015

DOI: 10.5370/jeet.2015.10.4.1460

Sponsors: Malaysia Ministry of Education and Universiti Teknologi MARA

Platforms: MATLAB

Model Documentation: AORML Other Narrative Flow charts Mathematical description

Model Code URLs: Model code not found

Abstract

This paper presents an approach to solve the long-term generation expansion planning problem of the restructured electricity industry using an agent-based environment. The proposed model simulates the generation investment decisions taken by a particular agent (i.e. a generating company) in a market environment taking into account its competitors' strategic investment. The investment decision of a particular company is Modeled taking into account that such company has imperfect foresight on the future system development hence electricity prices. The delay in the construction of new plants is also explicitly modeled, in order to compute accurately the yearly revenues of each agent. On top of a conventional energy market, several capacity incentive mechanisms including capacity payment and capacity market are simulated,, so as to assess their impact on the investment promotion for generation expansion. Results provide insight on the investment cycles as well as dynamic system behavior of long-term generation expansion planning in a competitive electricity industry.

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