Generation Expansion Planning in Brazilian Competitive Multi-Market Framework

Most generation expansion planning (GEP) methodologies developed under the monopolistic power industry framework were based on optimization models considering static and detailed descriptions of the power system's equipment and operating conditions. Many of these techniques are still in use in the current market framework, although planning in a liberalized environment is affected by a set of uncertainties and dynamics that traditional models are not designed to capture. In this setting, this research describes a GEP approach that uses System Dynamics (SD) to construct a simulation tool to provide planners, regulators, policy and decision makers with strategic and broader insights regarding policies to apply to power systems. The developed tool models the four Brazilian electricity submarkets, providing electricity prices and expansion scenarios in each region, given that policies recently applied at a country level are leading to different outcomes in each of these submarkets.