Electric Power Planning for Regulated and Deregulated Markets

Arthur Mazer, PhD, MBA, is Manager of Forward Transactions Planning at Southern California Edison, where he oversees the risk assessment of SCE's power, gas, and customer portfolio, as well as valuation and selection of power and gas contracts. He previously held positions at Electrabel, Progress Energy, and Entergy Power Marketing Corp. Additionally, he was visiting assistant professor at Utah State University and a lecturer at Singapore Polytechnic, both in the Department of Mathematics.

• Preface xiAcknowledgments xvFigure Citations xviiAbout the Author xix1. Overview 11.1 The Power Delivery Chain in a Vertically Integrated Utility 11.2 The Power Delivery Chain in a Market Environment 32. Energy, Load, and Generation Technologies 72.1 Energy, Power, and their Measurements 72.2 Load 142.3 Generation Technologies 213. The Grid 493.1 Fundamentals: Load, Generation, and Alternating Current 493.2 Grid Equipment 563.3 Grid Reliability and Contingency Requirements 643.4 Grid Configuration 673.5 Grid Operations 723.6 Blackout August 14, 2003 764. Short-Term Utility Planning 814.1 Planning and Execution of Dispatch: Day-Ahead Planning Through Real-Time Delivery 814.2 Day-Ahead Demand Forecasting: Load and Ancillary Service Requirements 844.3 Least-Cost Dispatch in a Single Control Area: A Simple Model 894.4 A Solution Using Profit Maximization 954.5 Least-Cost Dispatch in a Single Control Area with Operating Constraints 994.6 Least-Cost Dispatch in a Single Node with Spinning Reserve and Regulation 1114.7 Least-Cost Dispatch in a Network 1134.8 Real Time 1205. Long-Term Utility Planning 1225.1 Project Development 1225.2 The Planning Process 1275.3 Long-Term Load Forecasting 1295.4 A Simplified Look at Generation Capacity Additions 1315.5 Generation Additions and Retirements Within a Single Control Area 1435.6 Generation Additions and Retirements with Transmission to a Single Control Area 1475.7 Generation Additions and Retirements and Transmission Additions Within a Network 1485.8 Reserve Reuqirements 1516. Midterm Utility Planning 1526.1 Informational Requirements 1526.2 Formulation of the Optimization Problem 1567. A Market Environment 1617.1 Principles and Architecture 1617.2 Short-Term Market Design: Day-Ahead Scheduling Through Real-Time Delivery 1647.3 Long-Term Market Design: No Clear Solutions 1707.4 Midterm Market Design 1738. Asset Management in Short-Term Markets 1808.1 Retailers 1808.2 Power Producers 1838.3 Integrated Energy Companies 1899. Investment Analysis: Long-Term Planning in a Market Environment 1929.1 Investment Setting in Utility and Market Environments 1929.2 Project Analysis for a Merchant Plant 1939.3 Power Purchase Agreements (Long-Term Contracts) 20210. Risk Management in the Midterm Markets 21110.1 Retailer Risk 21110.2 Power Producer Risk 21410.3 A Quick Risk Primer in Statistics for Risk Management 21510.4 Risk Management in Midterm Markets: Retailers 22910.5 Risk Management in Midterm Markets: Power Producers 25210.6 Risk Management in Midterm Markets: Integrated Electricity Suppliers 27411. The California Experience 27811.1 Market Fundamentals 27911.2 Short-Term Market Structure: The CALPX, CAISO, and Other Market Participants 28111.3 Fatboy, Get Shorty, Ricochet, and Death Star 28611.4 Market Contrast: PJM and California 288Bibliography 291Index 294

"…'an ideal reference for professionals and private service sectors.' Thus it is for power industry professionals." (CHOICE, September 2007) "...a comprehensive book by an insider..." (Electrical Apparatus, July 2007)