A Smart PDIPM–GSF Framework for Congestion-Aware Optimal Power Flow and Electricity Pricing in Wind-Integrated Power Systems: Applications to the Algerian Electricity Market

This study presents a new improved primal–dual interior point method associated with a generation scaling factor (PDIPM–GSF) for congestion-aware optimal power flow (OPF) in power systems with renewable integration in a deregulated electricity market. The proposed framework combines the robustness of the primal–dual interior point method with an adaptive generation scaling strategy that adjusts generator outputs according to transmission line flow sensitivities, enabling early congestion mitigation, improved power flow feasibility, and accurate determination of locational marginal prices (LMPs). The proposed approach is evaluated on the IEEE 30-bus test system and a real 114-bus Algerian power network. The results demonstrate that the proposed framework can reduce generation costs and improve social profit under both single-sided and double-sided market operation through enhanced coordination between generation, demand, and congestion management. The impact of integrating wind energy is analyzed under different levels of wind energy penetration in the first IEEE 30-bus test system, showing that the integration of wind energy can not only improve social welfare and save generation costs but also lower transmission losses. Additionally, the results show that the placement of wind farms can improve the performance of the proposed PDIPM–GSF framework in terms of congestion management and reduction in LMPs at important nodes. For the 114-bus Algerian transmission network, renewable energy integration further demonstrates the capability of the proposed framework to reduce transmission losses and generation costs while improving overall market performance. These results demonstrate that the proposed PDIPM–GSF framework provides an effective smart optimization approach for renewable-integrated power systems by improving congestion management, facilitating large-scale WE integration, enhancing market efficiency, and ensuring reliable LMP computation. The proposed method, therefore, represents a practical and efficient solution for supporting future renewable energy transition and competitive electricity market operation in Algeria and other renewable-rich power systems.