This paper emphasizes the development of control strategy for inter-area oscillation suppression for a unified two-area hydro-thermal deregulated power system. A proportional derivative-type fuzzy logic controller with integral (PDFLC+I) controller was proposed for automatic generation control. Further comparisons among conventional integral controller, proportional integral derivative controller, and PDFLC+I are carried out, where the PDFLC+I controller is optimized by four different optimization techniques namely, algorithm, ant colony optimization, classical particle swarm optimization, and adaptive particle swarm optimization. In PDFLC+I controller optimization, scaling parameters of controllers are optimized. A comparative study shows that the proposed PDFLC+I controller has a better dynamic response following a step load change for the combination of PoolCo and bilateral contract-type transaction in deregulated environment. Proposed controller performance has also been examined for ±30% variation in system parameters. Non-linearity in the form of governor dead band is taken into account during simulation.


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