Abstract

The global climate change creates a dire need to mitigate greenhouse gas (GHG) emissions from thermal generation resources (TGRs). While microgrids are instrumental in enabling the deeper penetration of renewable resources, the short-term planning of microgrids needs to explicitly assess the full range of impact of GHG emissions. To this end, we propose a novel unit commitment (UC) approach, which enables the representation of GHG emissions from TGRs, the specification of GHG emission constraints, and the ex-ante evaluation of carbon tax payment with all other costs and benefits. We quantify the relative merits of the proposed approach vis-à-vis the classical UC approach via representative studies. The results indicate that the proposed UC approach yields lower costs than does the classical UC approach and achieves a greater reduction in costs as carbon tax rate increases. Further, increasing carbon tax rates can markedly disincentivize TGR generation under the proposed approach.