Setting greenhouse gas emission target for a generation mix expansion model

This paper proposes a systematic approach to set the greenhouse gas (GHG) emission target in a generation mix planning model of a regulated power system. The emission target is obtained while minimizing the financial cost of electricity production over a given planning horizon. In this model, the total GHG emitted during this period is constrained by an upper bound. This bound is adjusted until the Lagrange multiplier of the constraint is as close as possible to the expected average market price of GHG emission. Since this Lagrange multiplier is chosen to neutralize incentives from the external emission market, the corresponding bound is then considered to be an appropriate GHG emission target for the power system. Lastly, a case study is presented in which the model is applied to a power system resembling that of Ontario over a planning period of ten years.