The incorporation of renewable energy into power systems poses serious challenges to the transmission and distribution power system operators (TSOs and DSOs). To fully leverage these resources there is a need for a new market design with improved coordination between TSOs and DSOs. In this paper we propose two coordination schemes between TSOs and DSOs: one centralised and another decentralised that facilitate the integration of distributed based generation; minimise operational cost; relieve congestion; and promote a sustainable system. To this end, we approximate the power equations with linearised equations so that the resulting optimal power flows (OPFs) in both the TSO and DSO become convex optimisation problems. In the resulting decentralised scheme, the TSO and DSO collaborate to optimally allocate all resources in the system. In particular, we propose an iterative bi-level optimisation technique where the upper level is the TSO that solves its own OPF and determines the locational marginal prices at substations. We demonstrate numerically that the algorithm converges to a near optimal solution. We study the interaction of TSOs and DSOs and the existence of any conflicting objectives with the centralised scheme. More specifically, we approximate the Pareto front of the multi-objective optimal power flow problem where the entire system, i.e., transmission and distribution systems, is modelled. The proposed ideas are illustrated through a five bus transmission system connected with distribution systems, represented by the IEEE 33 and 69 bus feeders.
A quadratic approximation for the optimal power flow in power distribution systems
