Economic Dispatch with Environmental Considerations Using Marginal Rate
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Economic Dispatch with Environmental Considerations Using Marginal Rate of Substitution Decision Approach
Abstract

In this paper, a new decision approach is proposed for the incorporation of the carbon dioxideemission constraints in the solution of the unit commitment (UC) problem. An efficient particle swarmoptimization (PSO) algorithm is used for generating the fuel cost versus emission tradeoff function forCarbon Dioxide emission; the marginal rate of substitution (MRS) is then calculated to help the managersmore rationally determine the final optimal compromise decision for UC dispatch under thecontrolled-emission allowance. The proposed PSO/MRS approach has been successfully tested on the IEEE30-bus system dealing with the cost-emission economic dispatch problem. Furthermore, MRS for aparticular pollutant can be used for emissions allowance trading
.Keywords: particle swarm optimization (PSO), unit commitment (UC), marginal rate of substitution (MRS)
1. INTRODUCTION
Environmental concerns are becomingincreasingly relevant for companies as regulationson pollutants become more stringent, and customerawareness of environmental impacts increases. Amajor step in this direction is the Kyoto Protocol(UNFCCC, 1997), which establishes a 5% drop incarbon dioxide emissions compared to emissionsin 1990 for the industrialized countries. Recently,the European Parliament adopted the world’s firstmulti-national Emissions Trading Scheme (ETS)covering greenhouse gases in the Union (EP,2003). The scheme requires that companies fromcertain departments must limit their CO2 emissionsto allocated levels. We are interested here in theirinfluences on energy activities which provide acontrolled-emission issue. Emissions trading givespower producers the flexibility to meet annualreduction targets according to their own strategy. Ageneration manager might quantify and measurecarbon related risks and opportunities:• Power costs and prices;• Long and short term unit commitment;• Thermal unit penalization;• Trading additional emission allowances;• !!To take into account the CO2 allowances,some modifications have been introduced indifferent stages of unit commitment (UC).Basically, the power producers would like tosupply power to its customers with minimal totalemission (Gent and Lamont, 1972; Talaq et al.,1994) as well as minimal total fuel cost. Theminimal fuel cost of the UC problem is inadequatewhen pollutant emissions are also included in theoperation of power plants (Mendes et al., 2004).Since minimizing the fuel cost and emissions areconflicting objectives (Abido, 2003; Sudhakaran etal., 2004)


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