Optimal bidding strategy for generation companies alliance in electricity‐carbon‐green certificate markets

Abstract To promote the profit of generation companies and reduce carbon emissions from the generation sector, a two‐layer decision‐making model based on the cooperative game is proposed. Based on the analysis of a renewable‐fossil energy generation alliance to participate in electricity‐carbon‐green certificate markets, a robust optimization model considering the price uncertainty in the electricity spot market is first established based on the information gap decision‐making theory as the upper part of a two‐layer optimization model. Subsequently, the clearing models of the electricity spot, carbon emission trading, and green certificate markets are established. This two‐layer optimization model is transformed into a single‐layer model based on the well‐established KKT conditions. A profit allocation model for the members of the generation alliance is then presented based on the Shapley value and an improved nucleolus kernel method. Finally, the effectiveness of the proposed model is demonstrated by the IEEE 14‐bus power system.