Solving Bilevel AC OPF Problems by Smoothing the Complementary Conditions – Part I: Model Description and the Algorithm

The existing research on market price-affecting agents, i.e. price makers, neglects or simplifies the nature of AC power flows in system as it predominantly relies DC flows. This paper proposes a novel bilevel formulation based smoothing technique, where any strategic player can be modelled upper level, while clearing problem lower level uses convex quadratic transmission optimal flow (AC OPF), with goal achieving accuracy close to one exact nonlinear formulations. Achieving convexity is foundation for modeling since traditional single-level reduction techniques do not hold nonconvex models. participation OPF transformed into and solved using multiple such primal-dual counterpart, strong duality theorem, McCormick envelopes, complementary slackness, penalty factor, interaction discretization well proposed techniques. Due an extensive amount information descriptions, overall work presented two-part paper. first part provides literature overview, positions presents model solution algorithm, case studies are provided accompanying