Distributed generation (DG) generates electricity on small scale close to end user of power. There are many economical, technical and environmental benefits of using DG. By suitable placement of DGs at optimal location with optimal size, benefits of DG can be maximize. In the thesis work objective is to find the optimal capacity of distributed generation plant in a micro-grid to minimize the cost function. Three different cases are considered to determine the cost function. In first case it is assumed that price of installation cost of DG unit is fixed and based on the constraints on the capacity limit of DG, linear mathematical model is developed. Here the method is applied on solar, diesel and wind power unit. In second case uncertainty in installation cost of DG has been included. To deal with uncertainty fuzzy logic is used and membership function generated which defuzzified by different methods and converted into linear mathematical programming. Finally uncertainty included in number of DG unit used and in installation cost also, so that both objective function and constraints become fuzzy. For this condition mathematical equation is developed and defuzzified to convert fuzzy linear programming (FLP) problem into linear programming (LP). In this case new method of defuzzification is used which is called as symmetric method.LP problem is solved by simplex algorithm. A constraint has putted on power generation limit of each DG units. Finally comparison has been made among all the de-fuzzification techniques and between linear programming and fuzzy linear programming
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