POWER SYSTEM ANALYSIS

Economic Dispatch

Professor Tom Overbye, Department of Electrical and Computer Engineering

Announcements

Homework 7 is due now.

Be reading Chapter 11, concentrating on sections
11.4 and 11.5
Homework 8 is 11.19, 11.21, 11.26, 11.27
Design Project 2 from the book (page 345 to 348)
was due on Nov 15, but I have given you an
extension to Nov 29. The Nov 29 date is firm!

Power System Economic Operation

Power system loads are cyclical. Therefore the

installed generation capacity is usually much greater
than the current load. This allows options on how
to meet the current load
Generation costs can vary widely, with different
technologies balancing

the capital costs necessary to build the generator

the costs to actually produce electric power
for example, nuclear and some hydro have high capital
costs and low operating costs. Natural gas generators
have low capital costs, and higher operating costs
2

US & Illinois Gen Mix (Energy) 2005

Gen Type
Coal
Nuclear
Hydro
Gas
Petroleum
Renewable

US %
49.6
19.3
6.7
18.7
3.0
2.5

Illinois % California%
47.5
1.1
48.0
18.1
0.1
19.8
3.7
46.7
0.2
1.3
0.4
11.8 (14.4 in 1990)

Indiana is 94% coal, while Oregon is 63% hydro

(Oregon was 82% hydro in 1990)
Source: http://www.eia.doe.gov/cneaf/electricity/st_profiles/toc.html
3
2005 data

Komposisi Energi Primer Sistem Jawa

Bali tahun 2010

Thermal versus Hydro Generation

The two main types of generating units are thermal

and hydro
For hydro the fuel (water) is free but there may be
many constraints on operation

fixed amounts of water available

reservoir levels must be managed and coordinated
downstream flow rates for fish and navigation

Hydro optimization is typically longer term (many

months or years)
In 476 we will concentrate on thermal units, looking
at short-term optimization
5

Generator types

Traditionally utilities have had three broad groups

of generators

baseload units: large coal/nuclear; always on at max.

midload units: smaller coal that cycle on/off daily
peaker units: combustion turbines used only for several
hours during periods of high demand

Block Diagram of Thermal Unit

To optimize generation costs we need to develop

cost relationships between net power out and operating
costs. Between 2-6% of power is used within the
generating plant; this is known as the auxiliary power
7

Generator Cost Curves

Generator costs are typically represented by up to

four different curves

input/output (I/O) curve

fuel-cost curve
heat-rate curve
incremental cost curve

For reference
-

1 Btu (British thermal unit) = 1054 J

1 MBtu = 1x106 Btu
1 MBtu = 0.29 MWh
8

I/O Curve

The IO curve plots fuel input (in MBtu/hr) versus

net MW output.

Fuel-cost Curve

The fuel-cost curve is the I/O curve scaled by fuel

cost. A typical cost for coal is $ 1.70/Mbtu.

10

Heat-rate Curve
Plots the average number of MBtu/hr of fuel input
needed per MW of output.
Heat-rate curve is the I/O curve scaled by MW
Best for most efficient units are
around 9.0

11

PERMASALAHAN DAN EVALUASI

OPERASI SISTEM
Unjuk Kerja Pembangkit
Jenis

Heat Rate
(Btu/kWh)
PLN

NERC

PLTA
PLTU
PLTG
PLTD

EAF
PLN

EFOR

NERC

PLN

NOF

NERC

PLN

NERC

96.50

84.93

1.30

6.09 80.40

78.88

85.90

83.61

8.30

7.85 88.50

84.1

8695

85.10

86.12

9.20

12.88 87.80

41.69

10306 10716

77.15

82.9

12.95

19.66 84.35

37.41

10406 10335
9820 *)

*) PLTG yang diopersikan PLN belum sepenuhnya

menggunakan gas, masih ada penggunaan minyak dengan
perbandingan tertentu tergantung ketersediaan gas
12

Incremental (Marginal) cost Curve

Plots the incremental $/MWh as a function of MW.

Found by differentiating the cost curve

13

Mathematical Formulation of Costs

Generator cost curves are usually not smooth.

However the curves can usually be adequately
approximated using piece-wise smooth, functions.
Two representations predominate

quadratic or cubic functions

piecewise linear functions

In 476 we'll assume a quadratic presentation

Ci ( PGi ) i PGi PGi2

$/hr (fuel-cost)

dCi ( PGi )
ICi ( PGi )
2 PGi $/MWh
dPGi

14

Coal Usage Example

A 500 MW (net) generator is 35% efficient. It is being
supplied with Western grade coal, which costs $1.70
per MBtu and has 9000 Btu per pound. What is the
coal usage in lbs/hr? What is the cost?

At 35% efficiency required fuel input per hour is

500 MWh 1428 MWh
1 MBtu
4924 MBtu

hr 0.35
hr
0.29 MWh
hr
4924 MBtu
1 lb
547,111 lbs

hr
0.009MBtu
hr
4924 MBtu $1.70
Cost =

8370.8 $/hr or $16.74/MWh

hr
MBtu
15

Wasting Coal Example

Assume a 100W lamp is left on by mistake for 8
hours, and that the electricity is supplied by the
previous coal plant and that transmission/distribution
losses are 20%. How much irreplaceable coal has
he/she wasted?

With 20% losses, a 100W load on for 8 hrs requires

1 kWh of energy. With 35% gen. efficiency this requires
1 kWh 1 MWh
1 MBtu
1 lb

1.09 lb
0.35 1000 kWh 0.29 MWh 0.009MBtu
16

Incremental Cost Example

For a two generator system assume
C1 ( PG1 ) 1000 20 PG1 0.01PG21

$ / hr

C2 ( PG 2 ) 400 15 PG 2 0.03PG22

$ / hr

Then
dC1 ( PG1 )
IC1 ( PG1 )
20 0.02 PG1 $/MWh
dPG1
dC2 ( PG 2 )
IC2 ( PG 2 )
15 0.06 PG 2 $/MWh
dPG 2
17

Incremental Cost Example, cont'd

If PG1 250 MW and PG2 150 MW Then
C1 (250) 1000 20 250 0.01 2502 $ 6625/hr
C2 (150) 400 15 150 0.03 1502

$6025/hr

Then
IC1 (250) 20 0.02 250 $ 25/MWh
IC2 (150) 15 0.06 150 $ 24/MWh

18

Economic Dispatch: Formulation

The goal of economic dispatch is to determine the

generation dispatch that minimizes the
instantaneous operating cost, subject to the
constraint that total generation = total load + losses
m

Minimize

CT

Ci ( PGi )
i 1

Such that
m

PGi PD PLosses
i=1

Initially we'll
ignore generator
limits and the
losses
19

Unconstrained Minimization

This is a minimization problem with a single

inequality constraint
For an unconstrained minimization a necessary (but
not sufficient) condition for a minimum is the
gradient of the function must be zero, f (x) 0
The gradient generalizes the first derivative for
multi-variable problems:

f ( x )

f (x) f (x)
x , x ,
1
2

f (x)
,
xn
20

Minimization with Equality Constraint

When the minimization is constrained with an

equality constraint we can solve the problem using
the method of Lagrange Multipliers
Key idea is to modify a constrained minimization
problem to be an unconstrained problem

That is, for the general problem

minimize f (x) s.t. g(x) 0
We define the Lagrangian L(x, ) f (x) T g(x)
Then a necessary condition for a minimum is the
L x (x, ) 0

and

L (x, ) 0
21

Economic Dispatch Lagrangian

For the economic dispatch we have a minimization
constrained with a single equality constraint
L(PG , )

Ci ( PGi ) ( PD PGi )
i 1

(no losses)

i 1

The necessary conditions for a minimum are

L(PG , )
PGi

dCi ( PGi )

0
dPGi

(for i 1 to m)

PD PGi 0
i 1

22

Economic Dispatch Example

What is economic dispatch for a two generator
system PD PG1 PG 2 500 MW and
C1 ( PG1 ) 1000 20 PG1 0.01PG21

$ / hr

C2 ( PG 2 ) 400 15 PG 2 0.03PG22

$ / hr

Using the Largrange multiplier method we know

dC1 ( PG1 )
20 0.02 PG1
0
dPG1
dC2 ( PG 2 )

dPG 2

15 0.06 PG 2

500 PG1 PG 2 0
23

Economic Dispatch Example, contd

We therefore need to solve three linear equations
20 0.02 PG1

15 0.06 PG 2

500 PG1 PG 2 0
0
1 PG1 20
0.02
0
0.06 1 PG 2 15

1
1
500
PG1
312.5 MW
P 187.5 MW
G2

26.2 $/MWh

24

Lambda-Iteration Solution Method

The direct solution only works well if the

incremental cost curves are linear and no generators
are at their limits
A more general method is known as the lambdaiteration

the method requires that there be a unique mapping

between a value of lambda and each generators MW
output
the method then starts with values of lambda below and
above the optimal value, and then iteratively brackets the
optimal value
25

Lambda-Iteration Algorithm
Pick L and H such that
m

L
P
(

Gi ) PD 0

H
P
(

Gi ) PD 0

i=1

i=1

While H L Do

M ( H L ) / 2
m

If

M
H
M
P
(

0
Then

Gi
D
i=1

Else L M
End While
26

Lambda-Iteration: Graphical View

In the graph shown below for each value of lambda
there is a unique PGi for each generator. This
relationship is the PGi() function.

27

Lambda-Iteration Example
Consider a three generator system with
IC1 ( PG1 ) 15 0.02 PG1
$/MWh
IC2 ( PG 2 ) 20 0.01PG 2

$/MWh

IC3 ( PG 3 ) 18 0.025 PG 3

$/MWh

and with constraint PG1 PG 2 PG 3 1000 MW

Rewriting as a function of , PGi ( ), we have
PG1 ( )

15

0.02
18
PG3 ( )
0.025

PG2 ( )

20
0.01

28

Lambda-Iteration Example, contd

Pick L so

L
P
(

Gi ) 1000 0 and
i=1
m

H
P
(

Gi ) 1000 0
i=1

Try

20 then

PGi (20) 1000

i 1

15 20 18
0.02

0.01

Try H 30 then

0.025

1000 670 MW

PGi (30) 1000

1230 MW

i 1

29

Lambda-Iteration Example, contd

Pick convergence tolerance 0.05 $/MWh
Then iterate since H L 0.05

M ( H L ) / 2 25
m

Then since

H
P
(25)

1000

280
we
set

25
Gi
i 1

Since 25 20 0.05

M (25 20) / 2 22.5

m

L
P
(22.5)

1000

195
we
set

22.5
Gi
i 1

30

Lambda-Iteration Example, contd

Continue iterating until H L 0.05
The solution value of , , is 23.53 $/MWh
*

Once * is known we can calculate the PGi

23.53 15
PG1 (23.5)
426 MW
0.02
23.53 20
PG2 (23.5)
353 MW
0.01
23.53 18
PG3 (23.5)
221 MW
0.025
31

Lambda-Iteration Solution Method

The direct solution only works well if the

incremental cost curves are linear and no generators
are at their limits
A more general method is known as the lambdaiteration

the method requires that there be a unique mapping

between a value of lambda and each generators MW
output
the method then starts with values of lambda below and
above the optimal value, and then iteratively brackets the
optimal value
32

Generator MW Limits

Generators have limits on the minimum and

maximum amount of power they can produce
Often times the minimum limit is not zero. This
represents a limit on the generators operation with
the desired fuel type
Because of varying system economics usually many
generators in a system are operated at their
maximum MW limits.

33

Lambda-Iteration with Gen Limits

In the lambda-iteration method the limits are taken
into account when calculating PGi ( ) :
if PGi ( ) PGi ,max then PGi ( ) PGi ,max
if PGi ( ) PGi ,min then PGi ( ) PGi ,min

34

Lambda-Iteration Gen Limit Example

In the previous three generator example assume
the same cost characteristics but also with limits
0 PG1 300 MW

100 PG2 500 MW

200 PG3 600 MW

With limits we get
m

PGi (20) 1000

i 1

PG1 (20) PG 2 (20) PG 3 (20) 1000

250 100 200 450 MW (compared to -670MW)

m

PGi (30) 1000

i 1

300 500 480 1000 280 MW

35

Lambda-Iteration Limit Example,contd

Again we continue iterating until the convergence
condition is satisfied. With limits the final solution
of , is 24.43 $/MWh (compared to 23.53 $/MWh
without limits). The presence of limits will always
cause to either increase or remain the same.
Final solution is
PG1 (24.43) 300 MW
PG2 (24.43) 443 MW
PG3 (24.43) 257 MW
36