Reliability Based Min-Max Regret Stochastic Optimization Model for Capacity Market with Renewable Energy and Practice in China

Capacity market is a long-term clearing model to coordinate the traditional thermal generation and the renewable energy generation, which minimizes the total capacity cost of traditional generation, while satisfying the operational constraints and reliability requirement. Furthermore, to address the uncertainties in the long-term optimal decision, min-max regret is employed to find the optimal solution under the worst regret, generating several representable scenarios that can help generation companies to understand how these scenarios would impact on the future generation planning. Finally, a decomposition method is proposed to solve this reliability based min-max regret stochastic optimization model by bisection. The test results on one regional grid in China show the effectiveness of the proposed model.