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Generation investments, especially large-scale variable renewable energy, requires careful scrutiny of the state of the power system. Power system planning and operations in a developing country like Bangladesh can often achieve significant improvements in economics and security of supply, through modest and prudent investments. A review of the Bangladesh power sector is presented in this paper that highlights: (a) changes to dispatch protocols to undertake fuel-constrained dispatch optimization and ancillary services co-optimization and pricing; (b) issues related to the allocation of natural gas between sectors; and (c) a technology neutral investment framework. The study uses an hourly dispatch and ancillary services co-optimization model that also optimizes short to medium term investment decisions. The results demonstrate Bangladesh can: (a) reduce its production costs by 63% through more efficient dispatch; (b) reduce production costs by 77% by using an additional natural gas quota of 212 mmcfd (or a 23% increase); and (c) should have invested in power import and baseload gas/coal rather than expensive solar PV projects (proposed in 2011 at substantially higher cost at the time). When a carbon price is imposed in the model, the implied break even cost to justify the solar program is very high – in excess of $150/tonne. [ABSTRACT FROM AUTHOR]

Electricity markets have evolved over the years leading to sophisticated spot markets for contingency reserve in operation in a number of countries. This paper proposes a security-constrained optimal power flow based co-optimization of energy and reserve services. The proposed paradigm improves on the existing market clearing engines because it enables an endogenous determination of reserve requirements, allocation of reserve to generators and unbundled energy/reserve prices, to accurately reflect the impact of underlying line/generator contingencies. We highlight the salient aspects of the proposed formulation using a set of numerical examples. Copyright © 2013 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]