A long-term power generation investment decision-making method considering carbon emission impacts

To meet the demand for low-carbon transition of new power systems, this paper develops a long-term decision-making analysis model for power generation investment. First, the model considers the strategic decision-making of conventional price-leading generation, as well as the perfectly competitive decision-making of newly market-entering renewable generation as price-takers, to satisfy the long-term carbon emission reduction constraints. Second, a centralized quadratic programming approach based on the Nash-Gounod game is used to analyze the day-ahead electricity market prices. Then, in the proposed model, investment decisions (once a year) and production decisions (in each time period within a year) are made simultaneously, and an open-loop Gounod game model is built accordingly. Finally, the performance of the proposed method is evaluated in a simulated electricity market, where the game is tested over a period of up to 20 years, and the price and investment decisions under a series of scenarios, as well as the impacts of the number of market participants, emission limits, or emission policies, are analyzed. The results show that the application of the proposed method can achieve deep system decarbonization, which verifies its effectiveness.