Generation investment and risks modeling in a deregulated electricity market

Limbu, Tika Ram, Saha, Tapan K. and McDonald, John D. F. (2010) Generation investment and risks modeling in a deregulated electricity market. International Journal of Emerging Electric Power Systems, 11 3: 5-1-5-23. doi:10.2202/1553-779X.2502

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Author Limbu, Tika Ram
Saha, Tapan K.
McDonald, John D. F.
Title Generation investment and risks modeling in a deregulated electricity market
Journal name International Journal of Emerging Electric Power Systems   Check publisher's open access policy
ISSN 1553-779X
Publication date 2010-07-22
Sub-type Article (original research)
DOI 10.2202/1553-779X.2502
Open Access Status File (Publisher version)
Volume 11
Issue 3
Start page 5-1
End page 5-23
Total pages 23
Place of publication Berlin, Germany
Publisher Walter de Gruyter
Language eng
Abstract A new probabilistic model to simulate generation investment and risks applicable in a deregulated market is proposed. In this process, probabilistic production cost simulation is applied to simulate energy dispatches. Electricity prices are simulated from a modified Black-Scholes-Merton (BSM) based price simulation model. In this work, the existing BSM model is enhanced thus making it possible to simulate the demand and supply conditions in price determination. A complete investment analysis model is then developed by integrating the above two simulation processes. Using this model, generator investors can analyze the impacts on the anticipated revenue due to different plant efficiency, availabilities, bilateral contract markets and changes in demand and supply conditions. Simulated results show that the proposed model is able to analyse the viability in generation investment with much simplicity. Copyright ©1999-2011 Berkeley Electronic Press
Keyword Generation investment
Risk modelling
Power generation economics
Power generation planning
Probabilistic production cost simulation
Market simulations
Q-Index Code C1
Q-Index Status Confirmed Code
Institutional Status UQ
Additional Notes Article number 5.

Document type: Journal Article
Sub-type: Article (original research)
Collections: Official 2011 Collection
School of Information Technology and Electrical Engineering Publications
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Created: Wed, 09 Mar 2011, 20:10:00 EST by Tapan Kumar Saha on behalf of School of Information Technol and Elec Engineering