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Energy Pricing Model And The Cost Of Compensation Is Discussed

Posted on:2006-11-27Degree:MasterType:Thesis
Country:ChinaCandidate:C G FuFull Text:PDF
GTID:2206360155966676Subject:Power system and its automation
Abstract/Summary:PDF Full Text Request
The goal of reforming electricity industry is for deregulating, i.e., introducing the competition to allocate the resources optimally and find maximal social welfare. The first form for reforming electricity industry in many countries is the generation side market, which is the Power Pool trade model.The orderly and favorable development of electricity market has a far-reaching influence on national economics, which the central factor is electricity price. In this thesis, the price mechanism of short period power trade is studied based on the point of allocating resources optimally and pursuing maximal social welfare.Pricing depends on the cost analysis. From the point of supply-demand theory, the theoretic basis and its functions of marginal cost pricing are analyzed firstly in this thesis, and the economic meanings of primal problem and dual problem in mathematic programming are described. Based on this, the methods of forming price are presented which are cost minimization and payment minimization. It finds that the two methods have different results because of the different distribution mode of fixed operational cost for running generators.In Power Pool model, pricing based on cost minimization can realize the optimal allocation of resources, but the cost consumed by generators can't be recovered fully. So, emphasis is put on this problem in the thesis. The pricing method of cost minimization in which cost recovery has been taken into account is set up. The mechanism of how additive cost function works in allocating resources optimally is analyzed in detail. All market participants participate in the process of cost recovery which accords with the principles of equity. It is ensured that the results of self-dispatch which has considered uplift cost function are the same to the results of central-dispatch, finally the supply side and the demand side reach an equilibrium automatically.
Keywords/Search Tags:Electricity market, electricity price, average cost, marginal cost, cost recovery
PDF Full Text Request
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