Production costing with explicit recognition of unit duty cycle effects

Abstract

This paper describes a new probabilistic production costing algorithm henceforth t o be called the OPCOST method, which recognizes the stochastic nature of the duty cycle of a unit and models the generation system with explicit consideration of such operating characteristics as the system generation reserve policy, unit start up delay, unit start up failure, unit commitment policy and unit outage postponability. A comparison of the results obtained using a traditional production costing method and the OPCOST method show significant differences in the energies produced by the various categories of units. The OPCOST method IS physically based and minimizes the need for ad hoc assumptions. Therefore, the OPCOST method offers the possibility of greater accuracy and responsiveness t o system parameters.

A continuous, distribution approach for production costing

“…It should be noted that, although energy produced by the individual units is more accurately calculated by the proposed method, the total energy produced by the system, EES is about the same by all the three methods. The accuracy of the energy produced by the individual generating units is, however, important for the purposes of making sensitivity studies and comparison of alternatives [20]. The peaking units are in the later part of unit commitment order and they have high per unit energy costs [21].…”