An Investigation on the Impacts of Renewable Energy Sources in the Generation Expansion Planning Framework from Social Welfare Perspective

Nowadays, it is clear to everyone that climate change has posed a huge threat to human welfare. Hence, the growth of demand for electricity as well as the dependence of power sector to the fossil fuel sources has converted the electrical energy sector into one of the most important areas suitable for applying the restrictions and implementation of the solutions provided to mitigate greenhouse gases. Enacting different incentive-based support schemes pursuing the promotion of renewable energy sources along with emission reduction in power generation sector is treated as one the main provided solutions. In this paper, from various points of view, such as environmental issues, power sector investors’ profit and the surplus of electricity consumers, the effect of renewable penetration rate growth under implementation of incentive-based policies is evaluated in a long-term generation expansion planning framework by employing the concept of Bergson-Samuelson social welfare function. To achieve this aim, first, a comprehensive generation expansion planning model, faced by a generation company, is proposed, as the effect of one on the most popular policies, namely emission trading system, is incorporated into the model. As a mixed integer nonlinear programming problem, the model is solved through two different scenarios using the GMAS optimization package. Then, regarding the obtained optimized expansion strategies, aforementioned viewpoints are assessed.