A two-player game model of power cogeneration in New England

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 US and is compared to an efficient operation of the global system. An adaptation of a successive approximation algorithm is developed and applied to the case of New England. The results are presented for three scenarios which simulate the status quo, the PURPA situation, and the ideal cooperative optimum