BC3. Basque centre for climate change – Klima aldaketa ikergai

Seminar / Mintegia / Seminario
Market-based valuation of transmission network expansion. A heuristic application in GB.

Prof. Jose Manuel Chamorro (UPV/EHU)

ABSTRACT: Transmission investments are currently needed to meet an increasing electricity demand, to address security of supply concerns, and to reach carbon emissions targets. A key issue when assessing the benefits from an expanded grid concerns the valuation of the uncertain cash flows that result from the expansion. We develop a valuation model which combines optimization techniques, Monte Carlo simulation over the expansion project lifetime, and market data from futures contracts on commodities. The model allows for random failures in generation and transmission infrastructure. Uncertainty stems also from nodal loads, fuel prices, allowance prices, wind generation, and hydro generation. Thus the model accounts for the stochastic dynamics on both the demand side and the supply side. To demonstrate the model by example, we consider a simplified network with two nodes. It is intended to broadly resemble the power generation sectors in England/Wales and Scotland. We then focus on the proposed Western HVDC subsea link. We simulate the whole distribution of effects on system costs, carbon emissions, and unserved load.

Referenced information

http://esd.mit.edu/WPS/2011/esd-wp-2011-14.pdf

If you are interested in attending the Seminar, please register yourself clicking here

Faculty of Sarriko, 24th of May, 13:00 Room B0.13

* The Seminar will be in English. / Mintegia ingelesez burutuko da. / El seminario se realizará en inglés.