Optimal energy portfolio method for regulable hydropower plants under the spot market
The energy allocation method for regulable hydropower plants under the spot market significantly impacts their income. The available studies generally draw on the Conditional Value-at-Risk (CVaR) approach, which typically assumes a fixed risk aversion coefficient for generators. This assumption is b...
| Main Authors: | , , , , |
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| Format: | Article |
| Language: | English |
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Frontiers Media S.A.
2023-04-01
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| Series: | Frontiers in Energy Research |
| Subjects: | |
| Online Access: | https://www.frontiersin.org/articles/10.3389/fenrg.2023.1169935/full |
| _version_ | 1797851408044654592 |
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| author | Guanpeng Lu Ping Yang Zhuangzhuang Li Yi Yang Yufeng Tang |
| author_facet | Guanpeng Lu Ping Yang Zhuangzhuang Li Yi Yang Yufeng Tang |
| author_sort | Guanpeng Lu |
| collection | DOAJ |
| description | The energy allocation method for regulable hydropower plants under the spot market significantly impacts their income. The available studies generally draw on the Conditional Value-at-Risk (CVaR) approach, which typically assumes a fixed risk aversion coefficient for generators. This assumption is based on the assumption that the total energy the power plant can allocate is constant during the decision period. However, the amount of energy that the regulable hydropower plant can generate will be affected by inflow and water level during the decision period, and the assumption of the fixed risk aversion coefficient is only partially consistent with the actual decision behavior of the hydropower plant. In this regard, the time-varying relative risk aversion (TVRRA) based method is proposed for the energy allocation of regulable hydropower plants. That method takes the change value of the hydropower plant’s energy generation as the basis for adjusting the time-varying relative risk aversion coefficient to make the energy allocation results more consistent with the actual decision-making needs of the hydropower plant. A two-layer optimal method is proposed to obtain the income-maximizing energy portfolio based on regulable hydropower plants’ time-varying relative risk aversion coefficient. The inner point method solves the optimal energy portfolio of income and risk in the upper layer. The time-varying relative risk aversion coefficient in the lower layer accurately describes the dynamic risk preference of hydropower plants for each period. The results and comparison show that the proposed method increases the income of the energy portfolio by 31%, and water disposal of regulated hydropower plants is reduced by 2%. The energy portfolio optimization method for regulable hydropower plants proposed in this paper not only improves the economic income of hydropower plants but also improves the utilization rate of hydro energy resources and enhances the market competitiveness of regulable hydropower plants. |
| first_indexed | 2024-04-09T19:16:21Z |
| format | Article |
| id | doaj.art-f9a3bbee79244b9f9f204d9a8ae28cc3 |
| institution | Directory Open Access Journal |
| issn | 2296-598X |
| language | English |
| last_indexed | 2024-04-09T19:16:21Z |
| publishDate | 2023-04-01 |
| publisher | Frontiers Media S.A. |
| record_format | Article |
| series | Frontiers in Energy Research |
| spelling | doaj.art-f9a3bbee79244b9f9f204d9a8ae28cc32023-04-06T05:38:28ZengFrontiers Media S.A.Frontiers in Energy Research2296-598X2023-04-011110.3389/fenrg.2023.11699351169935Optimal energy portfolio method for regulable hydropower plants under the spot marketGuanpeng LuPing YangZhuangzhuang LiYi YangYufeng TangThe energy allocation method for regulable hydropower plants under the spot market significantly impacts their income. The available studies generally draw on the Conditional Value-at-Risk (CVaR) approach, which typically assumes a fixed risk aversion coefficient for generators. This assumption is based on the assumption that the total energy the power plant can allocate is constant during the decision period. However, the amount of energy that the regulable hydropower plant can generate will be affected by inflow and water level during the decision period, and the assumption of the fixed risk aversion coefficient is only partially consistent with the actual decision behavior of the hydropower plant. In this regard, the time-varying relative risk aversion (TVRRA) based method is proposed for the energy allocation of regulable hydropower plants. That method takes the change value of the hydropower plant’s energy generation as the basis for adjusting the time-varying relative risk aversion coefficient to make the energy allocation results more consistent with the actual decision-making needs of the hydropower plant. A two-layer optimal method is proposed to obtain the income-maximizing energy portfolio based on regulable hydropower plants’ time-varying relative risk aversion coefficient. The inner point method solves the optimal energy portfolio of income and risk in the upper layer. The time-varying relative risk aversion coefficient in the lower layer accurately describes the dynamic risk preference of hydropower plants for each period. The results and comparison show that the proposed method increases the income of the energy portfolio by 31%, and water disposal of regulated hydropower plants is reduced by 2%. The energy portfolio optimization method for regulable hydropower plants proposed in this paper not only improves the economic income of hydropower plants but also improves the utilization rate of hydro energy resources and enhances the market competitiveness of regulable hydropower plants.https://www.frontiersin.org/articles/10.3389/fenrg.2023.1169935/fullhydropower plantsenergy portfoliorisk measurement modelrisk aversion coefficientspot market |
| spellingShingle | Guanpeng Lu Ping Yang Zhuangzhuang Li Yi Yang Yufeng Tang Optimal energy portfolio method for regulable hydropower plants under the spot market Frontiers in Energy Research hydropower plants energy portfolio risk measurement model risk aversion coefficient spot market |
| title | Optimal energy portfolio method for regulable hydropower plants under the spot market |
| title_full | Optimal energy portfolio method for regulable hydropower plants under the spot market |
| title_fullStr | Optimal energy portfolio method for regulable hydropower plants under the spot market |
| title_full_unstemmed | Optimal energy portfolio method for regulable hydropower plants under the spot market |
| title_short | Optimal energy portfolio method for regulable hydropower plants under the spot market |
| title_sort | optimal energy portfolio method for regulable hydropower plants under the spot market |
| topic | hydropower plants energy portfolio risk measurement model risk aversion coefficient spot market |
| url | https://www.frontiersin.org/articles/10.3389/fenrg.2023.1169935/full |
| work_keys_str_mv | AT guanpenglu optimalenergyportfoliomethodforregulablehydropowerplantsunderthespotmarket AT pingyang optimalenergyportfoliomethodforregulablehydropowerplantsunderthespotmarket AT zhuangzhuangli optimalenergyportfoliomethodforregulablehydropowerplantsunderthespotmarket AT yiyang optimalenergyportfoliomethodforregulablehydropowerplantsunderthespotmarket AT yufengtang optimalenergyportfoliomethodforregulablehydropowerplantsunderthespotmarket |