A Performance Review of Lagrangian Relaxation Method For Unit Commitment in Korean Electricity Market
A Performance Review of Lagrangian Relaxation Method For Unit Commitment in Korean Electricity Market
A Performance Review of Lagrangian Relaxation Method For Unit Commitment in Korean Electricity Market
B. Structure of Korean Electricity Market systems (all figures are approximate, as of the end of 2006):
In April 2001, Korea’s generation sector was split into six
power generation subsidiaries including one big hydro and - Population: 48.8 [million]
nuclear power company (Korea Hydro & Nuclear Power com- - Generating capacity: 65,514 [MW]
pany, KHNP) and five thermal power companies (Korea - Peak demand: 58,994 [MW]
East-West Power Co., LTD., Korea South-East Power Co., - Annual generation output in market: 354,858 [GWh]
LTD., Korea Midland Power Co., LTD., Korea Southern - Transmission lines: 29,276 [C-km]
Power Co., LTD., Korea Western Power Co., LTD.) on an - Annual trading amount: USD 20.3 [million]
equal basis in terms of commercial and technical aspects. Most C. Key Features of Korean Electricity Market
of all, KHNP will remain as a public entity in consideration of
The Korean Cost-Based Pool (CBP) is shortly summarized
nuclear safety, the characteristics of power supply and demand,
as follows:
nuclear power development, and the capability of building new
1) All generators should offer their available capacities daily to
plants, while the other five power generation companies, con-
the pool.
sisting of fossil and pumped storage power plants, will be pri-
2) KEPCO is the only purchaser in the market.
vatized in the near future.
3) Eligible customers have been allowed to buy electricity from
As a neutral and independent organization, Korea Power
the pool since January 2003.
Exchange (KPX) plays a pivotal role in Korea's electric power
4) The dispatch schedule is naturally made based on the pre-
industry. The tasks to be performed by Korea Power Exchange
determined costs of each generating unit. In fact, the Genera-
are organized in Fig. 1.
tion Cost Evaluation Committee assesses the variable costs of
generating units once a month.
Mission 5) Two marginal prices (short-term marginal price and
base-load marginal price) and capacity payment (CP) are paid
to generation companies.
< Market Operation > < System Operation > 6) Both short-term marginal price (SMP) and base-load mar-
⋅ Competitive market man- ⋅ System planning
agement ⋅ Restoration planning ginal price (BLMP) cover actual production costs, which are
⋅ Market monitoring ⋅ Demand forecast made up of start-up, no-load, incremental costs, of the last
generating unit involved in the price-setting schedule. As such,
< Real-time Dispatch > < Statistics and Inter- there is no locational signal.
connection > 7) The capacity payment is paid to all generating units that can
⋅ Power balancing ⋅ Statistics analysis produce electricity whether they are dispatched or not. Plus, it
⋅ Quality management ⋅ Overseas interconnection
ensures the recovery of capital costs and thus underpins further
Fig. 1. Korea Power Exchange’s mission
investment of generating facilities.
The trading process in Korean electricity market is sketched
Below are the scopes of KPX operations in Korean power
in Fig. 2.
Generators
KPX
CP: Yearly Construction Cost
Prod. Cost
Evaluation
Var.:Monthly Fuel Cost
amount of reserves, and the ratio of steam turbine and gas TABLE I
TOTAL ENERGY COST BY LR AND MIP IN UNCONSTRAINED DISPATCH
turbine in combined cycle power plants.
LR MIP Cost
A new unit commitment program should be able to handle Date
[×103 won] [×103 won] savings [%]
various constraints in an efficient way: generation, transmis-
April 13, 2006 25,133,280 25,087,673 0.18
sion, reserve, emission, and security constraints. April 14, 2006 23,897,349 23,888,135 0.04
A. Generation constraints April 15, 2006 20,645,466 20,643,631 0.01
April 16, 2006 13,796,615 13,743,883 0.38
1) Water constraints of hydroelectric power plants April 17, 2006 22,816,052 22,762,560 0.23
2) Pumping and generation constraints of pumped storage April 18, 2006 24,141,538 24,087,877 0.22
power plants April 19, 2006 24,045,475 24,015,301 0.13
3) Heating constraints of co-generation
4) Fuel constraints in case of LNG or bituminous coal TABLE II
AVERAGE NUMBER OF UNITS COMMITTED DURING EACH HOUR
5) Must-run or fixed generation output
Date LR MIP
6) Constraints of 1), 2), 3), and 4) should be applied to a single
April 13, 2006 85 83
generating unit as well as in group.
April 14, 2006 83 80
7) Energy and fuel constraints should be modeled in a par- April 15, 2006 77 74
ticularly specified period. April 16, 2006 67 66
8) Hydraulic, thermal, and fuel constraints are expressed in April 17, 2006 83 79
lower limit, upper limit, or alternatively fixed one. April 18, 2006 83 80
April 19, 2006 83 80
B. Transmission constraints Average 80 78
A new unit commitment program should take into account
transmission network constraints. More specially, transmis- TABLE III
sion constraint between Jeju Island and the southwestern LR AND MIP COMPARISONS RESPECTING RESERVE AND TRANSMISSION
NETWORK CONSTRAINTS
inland area of Korea should be formulated in the following:
CPU Average
Energy cost
Constraints Solver times reserve
Min(Installed capacity of HVDC, 60 % of load-demand in Jeju [×103 won]
[sec/day] [MW/h]
Island) (1) LR 157,411,505 120 2,496
Reserve
C. Reserve constraints MIP 157,320,434 134 1,637
Transmission LR 157,722,120 120 1,460
Reserves should satisfy the inter-regional requirements and Network MIP 156,877,832 129 365
types of reserves. For example, some types of reserves with Reserve + LR 158,849,457 120 2,588
fast response time can replace the one with slow response time. Transmission MIP 158,208,592 157 1,642
Besides, transmission bottlenecks should be allowed to opti-
mize regional reserves. Accordingly, reserves in the receiving Table I shows total energy cost for the LR and MIP runs in
region may be appended to reserves in the sending region. the unconstrained dispatch. The largest difference between the
D. Extra constraints LR and the MIP is ₩53,661,000 on April 18, 2006. Typically,
Security-constrained economic dispatch is performed by the MIP are producing more excellent solution for unit com-
contingency analysis. In addition, transmission losses for the mitment problem with similar CPU times, taking approxi-
overall network may be appropriately taken into consideration. mately 2 minutes in this case. In the other hand, the average
The constraint on emission of harmful gases should be inde- number of generating units committed as per hour is described
pendently managed apart from the energy constraint, though in Table II. In general, the average number of generating units
the former is quite similar to the latter. committed in the MIP is obviously less than that in the LR,
which results in the remarkable cost savings.
V. CASE STUDY In Table III, simulation results of three cases are given for
comparative analysis of the total energy costs for a whole
When we carry out the unit commitment to Korean elec- week, average cpu times occupied, and average reserves se-
tricity market with LR and MIP formulation, the latter will cured in the LR and the MIP. Here, the amount of 1,500 [MW]
make further generation cost savings possible and help to is imposed on the reserve constraint, while the transmission
facilitate the power system operations in terms of reserve and network constraint is regarded as the limit of northward real
congestion. The results of our study are expected to provide a power flows from the non-metropolitan regions to the met-
useful guideline to improve or replace the existing generation ropolitan area through six interconnections. From 9:00 AM to
scheduling program for more sophisticated unit commitment 7:00 PM, the amount of 11,300 [MW] is applied and the
problem, along with recent advances in MIP commercial amount of 10,100 [MW] is assumed from 7:00 PM to 9:00 AM.
solvers. This section presents results from Korean electricity The final case includes the reserve constraint and transmission
market consisting of 247 units over a week study horizon. network constraint at the same time. As mentioned earlier, the
545 5
MIP is more cost effective than the LR since much less of BIOGRAPHIES
reserve for each hour is obtained in the MIP while meeting the Don Hur (M’00) was born in Seoul, Republic of Korea, on January 17, 1974.
reserve requirements. He received B.S.(1997), M.S.(1999), and Ph.D.(2004) degrees in electrical
engineering from Seoul National University, Seoul, Republic of Korea. He
was employed as an assistant electrical engineer by Burns&McDonnell En-
VI. CONCLUSION gineering Company, Kansas City, MO, USA from 2001 to 2002. He was also
In recent years, the yearly production costs in Korea re- appointed a visiting researcher in Engineering Research Institute at Seoul
National University in 2004. In 2005, he was a visiting scholar at the Univer-
quired to meet the nationwide load-demand account for about sity of Texas at Austin, Austin, TX, USA. Since September, 2005, he has been
10 billion dollars. If we slightly enhance the efficiency of working as a full-time lecturer at the Department of Electrical Engineering,
resource scheduling and commitment, we can experience the Kwangwoon University. He has co-authored more than 30 technical papers
published in international reviews on power system planning, reliability
tremendous generation cost savings in real-life situations. evaluation, and restructuring issues. He is a member of the Institute of Elec-
The unit commitment program installed in Korea makes the trical and Electronics Engineers (IEEE), the Institution of Engineering and
best of Lagrangian Relaxation algorithm, which seems, in part, Technology (IET), and the Korean Institute of Electrical Engineers (KIEE).
to be inefficient and inflexible on uncertain changes of the Hae Seong Jeong was born in Seoul, Republic of Korea, on December 22,
future electricity market. 1969. He received B.S.(1993), M.S.(1996), and Ph.D.(2004) degrees in elec-
In this context, we have tried to make a comparative trical engineering from Seoul National University, Seoul, Republic of Korea.
analysis of Lagrangian Relaxation and Mixed Integer Pro- In 2004-2005, he worked as a senior researcher at Korea Electrotechnology
Research Institute, Uiwang city, Gyeonggi province, Republic of Korea. His
gramming suitable for the unit commitment in Korean elec- research interests are in the areas of power system restructuring, power system
tricity market. Consequently, it can be concluded that the operation, and risk management in the deregulated electricity markets.
Mixed Integer Programming offers a number of important
Heung Jae Lee was born in Seoul, Republic of Korea, on January 28, 1958.
advantages over the Lagrangian Relaxation. He received B.S.(1983), M.S.(1986), and Ph.D.(1990) degrees in electrical
engineering from Seoul National University, Seoul, Republic of Korea. He
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