Electricity Market Restructuring, Economics, and Operations Research
Professor William Hogan from the Kennedy School of Government at Harvard University will deliver this lecture as part of the Fall 2006 Operations Research / Management Science Seminar series. All are invited to attend.
Abstract:
Existing technology for electricity network systems requires central control and coordination. Electricity markets emphasize use of incentives and reliance on individual choice. Constrained optimization and duality theory, core concepts in operations research, provide the organizing framework that addresses these dual requirements. Although application of this approach has revolutionized electricity markets, it remains a work in progress. This presentation reviews the essential issues to sketch the underlying problem and the nature of the formal model based on choosing an operating point to maximize a benefit function subject to a many constraints. The associated dual solution defines prices and gives rise to long-term derivative instruments that serve a function in providing transmission rights. Extensions include alternative stochastic models with operating reserve demand curves.
This series is organized by the UMass Amherst INFORMS Student Chapter. Support for this series is provided by the Isenberg School of Management, the Department of Finance and Operations Management, and the John F. Smith Memorial Fund.
Check here for more details about this speaker series.
