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This paper presents an economical approach for reliability improvement, harmonic mitigation and loss reduction in microgrids and active distribution networks that include of the distributed generations (DGs) considering technical constraints. The proposed method is a stochastic approach based on the calculation of the locational marginal price (LMP) in each DG bus. The problem is as a game-theoretic that each DG is taken as a single player considering its contributions on the aforementioned objectives. In this regard, each player gets a financial incentive as incremental price, based on a fair method using cooperative game-theoretic sharing strategy. In other words, each DG that aligns its generation with the aforementioned objectives will increase the price of selling energy. This increase in prices will lead to higher profits. Therefore, DGs are interested in volunteering to accomplish network goals. As a tool for system management, the proposed method can control the impact of the pricing in the form of incentives to satisfy each objective depending on its decision in the incentive allocation procedure. To obtain a more realistic framework, demands are considered as the uncertainty parameters. To validate the proposed method, it is evaluated on the real Taiwan Power Company (TPC) network. The promising results indicate that the total loss is decreased by 54.5%, harmonics are mitigated by 12.3% and the reliability is improved by 12.6%. [ABSTRACT FROM AUTHOR]

• A new ATC-based approach is developed for optimal scheduling of an MA-ADN. • Inter-area SOPs are optimally scheduled without any central coordinator. • The independence and privacy of the areas are preserved. • The minimum number of data is exchanged in the proposed model. • All technical constraints are modeled in a fully decentralized manner. To increase the flexibility of a Multi-Area Active Distribution Network (MA-ADN), normally opened tie-branches between two different areas are replaced with Soft Open Points (SOPs). In this paper, a cooperative framework based on Analytical Target Cascading (ATC) method is proposed for optimal scheduling of an MA-ADN in the presence of inter-area SOPs, which preserves independence and privacy of the areas. The proposed ATC-based Decentralized Model (ATCDM) optimally determines the day-ahead scheduling of the Distributed Energy Resources (DERs) and SOPs, trading with the Upstream Network (UN), along with inter-area transactions, without the need of a central control unit. The technical constraints of SOPs, DERs, AC load flow equations, and privacy constraints are considered and modeled in a convex form. The proposed ATCDM has the least number of coupling variables between the areas, which relieves the complexity of the model and reduces the communication network traffic. In this model, the total operating costs of MA-ADN are reduced, while preserving the technical constraints of the network such as the voltage range of the buses and the thermal capacity of the lines, in a fully decentralized style. To evaluate its performance, the proposed ATCDM is applied on the modified IEEE 33-bus, the modified IEEE 123-bus, and the modified Taiwan Power Company (TPC) distribution networks. The simulation results are compared with the centralized approach, in which all areas are centrally scheduled by a central unit. The comparison of the results showcases the optimality of the proposed ATCDM. [ABSTRACT FROM AUTHOR]