Public Utility Economics

Crew, Michael A.; Kleindorfer, Paul R.

doi:10.1007/978-1-349-03263-1

Cited by 87 publications

(48 citation statements)

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“…This method is fundamentally different from the least-cost planning because it optimizes the long-term social welfare instead of just long-run generation cost. The short-term social welfare is the sum of total revenue, consumers' surplus and negative generation cost and it is computed by taking into consideration the energy users' willingness to pay [23]. The centralized peak-load pricing method optimizes the long-term social welfare, which is the sum of long-run cumulative short-term social welfare and the negative capital cost associated with investments in new generation resources.…”

Section: Thesis Synopsis: Problem Statement Proposed Solution and Mamentioning

confidence: 99%

“…The best long-term solutions require co-optimizing operating costs and capital investments simultaneously [23]- [24]. Only this approach will give an optimal trade-off between the short-term cumulative inefficiency and the capital cost of the new candidate equipment.…”

Section: Multi-attribute Trade-off Analysismentioning

confidence: 99%

“…Supply offer Demand offer Day-ahead capacity Day-ahead price period consumers are charged only for the energy price while, during peak hours, they are charged for both energy and the required capacity ( [23], [28], [63]- [69]). The main assumption for peak load pricing is price-responsiveness of demand.…”

Section: Centralized Peak Load Pricing Modelmentioning

confidence: 99%

“…The main idea is that consumers who are using a system during a capacity scarcity period are responsible for investment into new capacity. This approach should discourage consumption during peak hours and encourage consumption during off-peak hours to improve system utilization [23]. Furthermore, investment into new capacity will depend on demand willingness to pay for services.…”

Section: Centralized Peak Load Pricing Modelmentioning

confidence: 99%

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An algorithmic interactive planning framework in support of sustainable technologies

Prica

Ilić

2015

2015 IEEE Power &Amp; Energy Society Innovative Smart Grid Technologies Conference (ISGT)

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This thesis addresses the difficult problem of generation expansion planning that employs the most effective technologies in today's changing electric energy industry. The electrical energy industry, in both the industrialized world and in developing countries, is experiencing transformation in a number of different ways. This transformation is driven by major technological breakthroughs (such as the influx of unconventional smaller-scale resources), by industry restructuring, changing environmental objectives, and the ultimate threat of resource scarcity.This thesis proposes a possible planning framework in support of sustainable technologies where sustainability is viewed as a mix of multiple attributes ranging from reliability and environmental impact to short-and long-term efficiency. The idea of centralized peak-load pricing, which accounts for the tradeoffs between cumulative operational effects and the cost of new investments, is the key concept in support of long-term planning in the changing industry. To start with, an interactive planning framework for generation expansion is posed as a distributed decision-making model. In order to reconcile the distributed sub-objectives of different decision makers with system-wide sustainability objectives, a new concept of distributed interactive peak load pricing is proposed. To be able to make the right decisions, the decision makers must have sufficient information about the estimated long-term electricity prices. The sub-objectives of power plant owners and load-serving entities are profit maximization. Optimized long-term expansion plans based on predicted electricity prices are communicated to the system-wide planning authority as long-run bids. The long-term expansion bids are cleared by the coordinating planner so that the system-wide long-term performance criteria are satisfied. The interactions between generation owners and the coordinating planning authority are repeated annually. We view the proposed interactive planning framework as a necessary paradigm for planning in the changing industry where choice must be reconciled with societal public objectives.ii ACKNOWLEDGEMENTS First and foremost I want to thank my advisor Professor Marija Ilic. It has been an honor to be her doctoral student. I appreciate all her contributions of time, ideas, and funding to make my studying possible. I am thankful for the exceptional example she has provided as a successful woman engineer and professor.

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Section: Thesis Synopsis: Problem Statement Proposed Solution and Mamentioning

confidence: 99%

Section: Multi-attribute Trade-off Analysismentioning

confidence: 99%

Section: Centralized Peak Load Pricing Modelmentioning

confidence: 99%

Section: Centralized Peak Load Pricing Modelmentioning

confidence: 99%

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An algorithmic interactive planning framework in support of sustainable technologies

Prica

Ilić

2015

2015 IEEE Power &Amp; Energy Society Innovative Smart Grid Technologies Conference (ISGT)

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“…In part III a model for distribution development planning that is based on the concept of peak-load pricing and optimal distribution capacity expansion [1] is proposed. This model is useful for utilities that supply price-responsive customer demands.…”

Section: Introductionmentioning

confidence: 99%

Peak-load pricing based planning for distribution networks under change

Prica

Ilić²

2006

2006 IEEE Power Engineering Society General Meeting

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Abstract--Distribution network development planning is a complex task due to the size of a typical distribution network, the interconnectivity of its elements and the presence of various uncertainties. The recent technological and organizational changes in the electric industry sector have had an influence on the operations and planning objectives of distribution network systems. New price regulation, technologies, and types of customer demand require new paradigms of distribution network planning and operations. The corresponding models in support of these new paradigms should include not only the information about load forecast, but economic analysis, risk assessment and the impact of the new technologies. In this paper, we propose a model for distribution development planning that is based on the concept of peak-load pricing and optimal distribution capacity expansion.

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A two‐part incentive scheme to implement productive efficiency over time

Tam

1992

Manage Decis Econ

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Under rate‐of‐return regulation the firm is not induced to minimize cost. All the incentive regulatory schemes thus far suggested in the literature have the desirable feature of inducing the firm to do so, but they either require the regulator to have full information about demand or take a number of periods to induce the firm to converge to the optimal output level. Hence they do not work well in the dynamic situation where demand and/or cost changes. In this paper a two‐part negative price incentive scheme is suggested whereby the regulator will implement the subsidy scheme only if the firm charges a price higher than its unit expenditure. This scheme (1) requires limited information for implementation; (2) induces the firm to minimize costs; and (3) under certain situations leads to optimal behavior in one period. More importantly, it will continue to have the above features over time.

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Public Utility Economics

Abstract: This book is sold subject to the standard conditions of the Net Book Agreement.

Cited by 87 publications

References 0 publications

An algorithmic interactive planning framework in support of sustainable technologies

An algorithmic interactive planning framework in support of sustainable technologies

Peak-load pricing based planning for distribution networks under change

A two‐part incentive scheme to implement productive efficiency over time

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