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A power retailer serves a group of customers and conducts load forecasting for hourly energy consumption. It purchases power based on the forecasting results. Any discrepancies between forecasted and actual loads will be balanced in spot market. Table 1 shows the forecasts and the average purchasing costs for a 3-hour period. Table 2 shows the actual loads and market prices for the three hours. The flat rate for the customers is 35 $/MWh. 1) Calculate the profit/loss that this retailer makes in this period. 2) Note that hour 3 forecast is an overestimate of the actual load. What if the forecasting result for hour 3 is 200MW which under-estimates the actual load? Compare the profit in two cases and explain your finding. Table 1: Load forecasts and purchase costs Hour 1 Hour 2 Hour 3 Forecast (MW) 150 200 250 Average Cost ($/MWh) 20 22 24 Table 2: Actual loads and market prices Hour 1 Hour 2 Hour 3 Actual Load (MW) Market Price ($/MWh) 132 215 227 10 12 40

A power retailer serves a group of customers and conducts load forecasting for hourly energy consumption. It purchases power based on the forecasting results. Any discrepancies between forecasted and actual loads will be balanced in spot market. Table 1 shows the forecasts and the average purchasing costs for a 3-hour period. Table 2 shows the actual loads and market prices for the three hours. The flat rate for the customers is 35 $/MWh. 1) Calculate the profit/loss that this retailer makes in this period. 2) Note that hour 3 forecast is an overestimate of the actual load. What if the forecasting result for hour 3 is 200MW which under-estimates the actual load? Compare the profit in two cases and explain your finding. Table 1: Load forecasts and purchase costs Hour 1 Hour 2 Hour 3 Forecast (MW) 150 200 250 Average Cost ($/MWh) 20 22 24 Table 2: Actual loads and market prices Hour 1 Hour 2 Hour 3 Actual Load (MW) Market Price ($/MWh) 132 215 227 10 12 40

ENGR.ECONOMIC ANALYSIS
ENGR.ECONOMIC ANALYSIS
14th Edition
ISBN:9780190931919
Author:NEWNAN
Publisher:NEWNAN
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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A power retailer serves a group of customers and conducts load forecasting for hourly energy consumption. It purchases power based on the forecasting results. Any discrepancies between forecasted and actual loads will be balanced in spot market. Table 1 shows the forecasts and the average purchasing costs for a 3-hour period. Table 2 shows the actual loads and market prices for the three hours. The flat rate for the customers is 35 $/MWh. 1) Calculate the profit/loss that this retailer makes in this period. 2) Note that hour 3 forecast is an overestimate of the actual load. What if the forecasting result for hour 3 is 200MW which under-estimates the actual load? Compare the profit in two cases and explain your finding. Table 1: Load forecasts and purchase costs Hour 1 Hour 2 Hour 3 Forecast (MW) 150 200 250 Average Cost ($/MWh) 22 24 Table 2: Actual loads and market prices Hour 1 Hour 2 Hour 3 Actual Load (MW) Market Price ($/MWh) 132 215 227 10 12 40
Transcribed Image Text:A power retailer serves a group of customers and conducts load forecasting for hourly energy consumption. It purchases power based on the forecasting results. Any discrepancies between forecasted and actual loads will be balanced in spot market. Table 1 shows the forecasts and the average purchasing costs for a 3-hour period. Table 2 shows the actual loads and market prices for the three hours. The flat rate for the customers is 35 $/MWh. 1) Calculate the profit/loss that this retailer makes in this period. 2) Note that hour 3 forecast is an overestimate of the actual load. What if the forecasting result for hour 3 is 200MW which under-estimates the actual load? Compare the profit in two cases and explain your finding. Table 1: Load forecasts and purchase costs Hour 1 Hour 2 Hour 3 Forecast (MW) 150 200 250 Average Cost ($/MWh) 22 24 Table 2: Actual loads and market prices Hour 1 Hour 2 Hour 3 Actual Load (MW) Market Price ($/MWh) 132 215 227 10 12 40
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