A Two-Level Systems Analysis Model of Power Cogeneration under Asymmetric Pricing

The interaction between a utility company and electricity cogenerators is modeled via a game-theoretic, systems analysis approach, under the assumption of asymmetric pricing of electricity purchased or sold by the cogenerators. The pricing scheme is derived from the PURPA legislation prevailing in the United States, and is compared to an efficient operation of the global system. Two variations of the cobweb algorithm are developed and applied to the case of New England. The second variation has converged in cases when the regular cobweb algorithm has not. The results are presented for three scenarios which simulate the status quo, the PURPA situation, and the ideal cooperative optimum.