A three-level static MILP model for generation and transmission expansion planning

David Pozo, Enzo E. Sauma, Javier Contreras

Research output: Contribution to journalArticlepeer-review

198 Citations (Scopus)


We present a three-level equilibrium model for the expansion of an electric network. The lower-level model represents the equilibrium of a pool-based market; the intermediate level represents the Nash equilibrium in generation capacity expansion, taking into account the outcomes on the spot market; and the upper-level model represents the anticipation of transmission expansion planning to the investment in generation capacity and the pool-based market equilibrium. The demand has been considered as exogenous and locational marginal prices are obtained as endogenous variables of the model. The three-level model is formulated as a mixed integer linear programming (MILP) problem. The model is applied to a realistic power system in Chile to illustrate the methodology and proper conclusions are reached.

Original languageEnglish
Article number6244821
Pages (from-to)202-210
Number of pages9
JournalIEEE Transactions on Power Systems
Issue number1
Publication statusPublished - 2013
Externally publishedYes


  • Equilibrium problem subject to equilibrium constraints (EPEC)
  • Mathematical program subject to equilibrium constraints (MPEC)
  • Nash equilibrium
  • Power systems economics
  • Power transmission planning


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