TOWARD REACTIVE POWER MARKETS: MULTI-OBJECTIVE OPTIMIZATION OF DISTRIBUTED GENERATION APPLIED TO THE IEEE 57-BUS SYSTEM

Abstract

Future power grids will be characterized by the extensive integration of distributed generation (DG) from renewable energy sources, introducing new challenges for system operation and management. This study addresses the underutilized reactive power potential of distributed generation (DG) in power systems through a comprehensive five-objective optimization framework. The framework simultaneously minimizes transmission losses, voltage deviations, generation costs, voltage stability indices, and DG reactive power requirements. Four metaheuristic algorithms (SPEA2, MOPSO, NSGA-II, and MOEA/D) are comparatively evaluated on a modified IEEE 57-bus system with solar DG capacity across five operational scenarios over 24 hours. Results show that coordinated DG reactive support reduces transmission losses compared to active-power-only operation. SPEA2 and MOPSO provide better Pareto front quality with higher hypervolume values and DG units can provide 20-40 MVAr of reactive support, representing significant economic value under emerging reactive power markets. These findings provide practical guidelines for system operators designing reactive power strategies in networks with high renewable penetration, showing that proper DG coordination improves technical performance while creating new revenue opportunities through ancillary services.