A Cooperative Game Theory-based Approach to Sizing and Siting of Distributed Energy Resources

Optimal placement of distributed energy resources (DERs) is desirable for maximizing their potential benefits especially in stressed power grids with high penetration of renewable energy sources and deregulated electricity market. This paper proposes a cooperative game theory-based two-stage approach to effectively determine optimal locations and sizes of DERs. In the first stage, a certain number of candidate locations of DERs are selected based on the equivalent locational marginal costs (LMCs) per unit active power at each bus and the worths (or values) of individual candidate locations and their coalitions are computed. The equivalent LMCs are determined using the weighted average of LMCs for reduced load scenario sets. In the second stage, the Shapley value, one of the solution concepts of cooperative game theory, is used to determine the optimal locations and sizes of DERs. Case studies on IEEE 14-bus and 30-bus systems show that the total cost of generation is reduced after DER placement using the proposed approach as compared to the-state-of-the-art approaches.