Bid-aggregation based clearing of day-ahead electricity markets
share
In day-ahead electricity markets large numbers of supply and demand bids are submitted, the acceptance or rejection of which must be decided subject to various restrictions. These restrictions, often originating from technological considerations and implying integer type variables, can make the computations of the underlying optimization problem time-consuming. In this work we consider a market clearing approach, using a novel approximation method based on the aggregation of bids. The proposed method provides optimal or nearly optimal solutions in most of the analyzed scenarios and reduces computational time by several orders of magnitude in the case of high bid numbers.
READ FULL TEXT