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Optimization models and solution methods for load management
Author(s) -
Gustafsson StigInge,
Rönnqvist Mikael,
Claesson Marcus
Publication year - 2004
Publication title -
international journal of energy research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.808
H-Index - 95
eISSN - 1099-114X
pISSN - 0363-907X
DOI - 10.1002/er.966
Subject(s) - electricity , profitability index , tariff , order (exchange) , electricity market , load management , environmental economics , economics , factory (object oriented programming) , operations research , control (management) , operations management , business , computer science , engineering , finance , electrical engineering , management , international trade , programming language
Abstract The electricity market in Sweden has changed during recent years. Electricity for industrial use can now be purchased from a number of competing electricity suppliers. Hence, the price for each kilowatt‐hour is significantly lower than it was just two years ago and interest in electricity conservation measures has declined. However, part of the electricity tariff, i.e. the demand cost expressed in Swedish Kronor (SEK) for each kilowatt, is almost the same as before. Attention has thereby been drawn to load management measures in order to reduce this specific cost. Saving one kWh might lead to a monetary saving of between SEK 0.22 and SEK 914; this paper demonstrates how to eliminate only those kWh that actually save a significant amount of money. A load management system has been installed in a small carpentry factory that can turn off equipment based on a pre‐set priority and number of minutes each hour. The question now is what level of the electricity load is optimal in a strictly mathematical sense, i.e. how many kW should be set in the load management computer in order to maximise profitability? In this paper, we develop a mathematical model that can be used as a tool both to find the most profitable subscription level and to control the choices to be made. Numerical results from a case study are presented. Copyright © 2004 John Wiley & Sons, Ltd.