An analytical formula for the mean and variance of marginal costs for a power generation system

In the upcoming deregulated environment, the marginal cost of power generation will play an important role. This paper provides an analytical formula for estimating the expected value and variance of the average marginal cost over a given study horizon using an enhanced stochastic version of the Baleriaux model. For the numerical example considered, this procedure provides accurate estimates in much less computer time as compared to a Monte Carlo simulation