Energy efficiency resource modeling in generation expansion planning

Energy efficiency plays an important role in mitigating energy security risks and emission problems. In this paper, energy efficiency resources are modeled as efficiency power plants (EPP) to evaluate their impacts on generation expansion planning (GEP). The supply curve of EPP is proposed using the production function of electricity consumption. A decision making framework is also presented to include EPP in GEP problem from an investor's point of view. The revenue of EPP investor is obtained from energy cost reduction of consumers and does not earn any income from electricity market. In each stage of GEP, a bi-level model for operation problem is suggested: the upper-level represents profit maximization of EPP investor and the lower-level corresponds to maximize the social welfare. To solve the bi-level problem, a fixed-point iteration algorithm is used known as diagonalization method. Energy efficiency feed-in tariff is investigated as a regulatory support scheme to encourage the investor. Results pertaining to a case study are simulated and discussed.