Decentralised approach for congestion management and congestion price discovering

Power systems are undergoing a significant change by introducing competition. In a market environment, the decentralised decision-making approach should be strongly encouraged so as to use an ´invisible hand´ to achieve efficient market equilibrium. However, in current power markets, centralised decision-making is still widely used due to the lack of proper decentralised optimal methods, e.g. a centralised OPF is used for managing congestion and setting the congestion price. A decentralised approach for congestion management in the spot market, which can also discover the congestion price, is proposed. In this approach, each participant tries to maximise their own profit with the help of system information announced by the operator. It is shown that the suggested decentralised approach can yield the same optimal dispatch solution as the centralised approach. Computer simulations are conducted on a three-bus test system and the IEEE 30-bus system. The results show clearly the effectiveness of the suggested method.