Optimal planning of microgrid power and operating reserve capacity

This paper proposes a bi-level formulation for a coupled microgrid power and reserve capacity planning problem, cast within the jurisdiction of a distribution system operator(DSO). The upper level problem of the proposed bi-level model represents a microgrid planner whose goal is to minimize its planning and operational cost, while the lower level problem represents a DSO whose primary duty is to ensure reliable power supply. The microgrid planner, pursues its interest by co-optimizing the design configuration and power output of individual distributed energy resources (DERs), while the DSO maximizes the capacity of flexible reserve resources. The proposed model is recast as a mathematical program with equilibrium constraints (MPEC) wherein the decision variables of the two problems are independently controlled. Application of the proposed approach to the energy infrastructure of a Canadian utility network is discussed. Results obtained through its application are compared to an alternative multi-objective planning model and the improved benefits are assigned to the corresponding stakeholders.