Journal of Energy Markets

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A simplified approach for optimizing hydropower generation scheduling

Frode Kjaerland and Berner Larsen

ABSTRACT

This paper presents a simplified model for optimizing hydropower scheduling for a small producer with a high degree of flexibility. The approach involves selecting the hours with the highest prices. The power plants run at full capacity all hours of the next days when hourly spot prices are greater than the upper p percentile of the hourly spot prices for the last two years (17 520 hours), and do not run otherwise. The simulations for an eight-year period, 2002-9, show a considerable increase in income. The producer can achieve 19% more income compared with a more naive strategy of generating at peak hours on weekdays. Our simulations also show that an optimal choice of p is a value lower than the load factor of the plants, due to the general increase in prices in the studied period.

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