DocumentCode :
267516
Title :
Real options on power system planning under uncertainties and efficiency constraints
Author :
Osthues, Marc ; Rehtanz, Christian ; Blanco, Gerardo ; Negnevitsky, Michael
Author_Institution :
Tech. Univ. Dortmund, Dortmund, Germany
fYear :
2014
fDate :
18-22 Aug. 2014
Firstpage :
1
Lastpage :
7
Abstract :
Deregulation and large-scale renewable energy penetration have increased uncertainties in power system planning. Strategic flexibility in project planning and decision making is needed to mitigate increasing risks. This paper proposes a methodology that improves decision making by valuing the flexibility of investment strategies to cope with uncertainty. This is done by integrating maintenance and expansion planning. The flexibility of investment strategies, including reinvestment and expansion projects under uncertainties, is evaluated by a Real Option approach. The proposed methodology is tested on a 30-bus IEEE system. Monte Carlo simulations of uncertain state variables and the Least-Squares Monte Carlo approach are applied for evaluating investment options using dynamic backward programming. The analysis shows that flexible strategies gain in importance with increasing uncertainty and under efficiency constraints. In addition, the deferral of the final investment decision between alternative strategies remains a valuable option.
Keywords :
IEEE standards; Monte Carlo methods; decision making; dynamic programming; least squares approximations; maintenance engineering; power system planning; renewable energy sources; risk analysis; 30-bus IEEE system; decision making; dynamic backward programming; efficiency constraint; expansion planning; investment strategy; large-scale renewable energy penetration; least square Monte Carlo approach; power system planning; risk mitigation; uncertain state variable; uncertainty constraint; Decision making; Investment; Maintenance engineering; Planning; Power system planning; Robustness; Uncertainty; Monte Carlo Simulation; Power System Planning; Real Options; Uncertainty;
fLanguage :
English
Publisher :
ieee
Conference_Titel :
Power Systems Computation Conference (PSCC), 2014
Conference_Location :
Wroclaw
Type :
conf
DOI :
10.1109/PSCC.2014.7038324
Filename :
7038324
Link To Document :
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