Optimal Operation of a Combined Heat and Power System Considering Real-time Energy Prices

The combined heat and power (CHP) systems can provide heat and electricity simultaneously. They are promising in the future energy landscape because of high efficiency and low emissions. This paper proposes a new operation optimization model of CHPs in deregulated energy markets. Both CHPs' overall efficiency and heat to electricity ratio are closely linked with the loading level, which are dynamically determined in this paper. A discrete optimization model is then proposed to determine the optimal real-time operation strategies for the CHPs. The optimization problem is solved by the interior point method with discrete time intervals, in which the discrete optimal operation points can be identified effectively. This step projects the potential operation strategies that could produce maximum benefits. Finally, a dynamic programming algorithm is developed to maximize the profits of CHPs through dynamically modifying the operation strategies projected in the previous step considering transient constraints. The proposed new methodology is demonstrated on a 1-MW CHP system with real-time data.

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