Medium-Term Scheduling and Transaction Decision Method for Cascade Hydropower Stations Based on IGDT and Prospect Theory

AbstractDue to the uncertainty of daily reservoir inflow and market clearing power price, the market-oriented operation of cascade hydropower stations faces both transaction risk in the bidding stage and performance risk in the operation stage. It is difficult to obtain the fluctuation range of uncertain variables and establish a reasonable bidding strategy when the expected power sale profit is met. This work developed a medium-term scheduling and transaction decision method for cascade hydropower stations based on information gap decision theory (IGDT) and prospect theory. For performance risk in the operation stage, the IGDT-based robust optimization model solves the maximum fluctuation range of the uncertain variables under different expected profits from power sale. For transaction risk in the bidding stage, prospect theory analyzes the bidding strategy of cascade hydropower stations according to the fluctuation range of uncertain variables, and the corresponding bidding decision model and solution are provided. A cascaded hydropower system in Southwest China was used as a case study to verify the proposed method. The results showed that this method could provide an acceptable fluctuation range of the uncertain variables and a bidding strategy to ensure the expected profit. According to different risk preferences, decision makers can evaluate a range of strategies to optimize bidding and operation, to guarantee the expected profit of cascaded hydropower stations.