Abstract
This paper aims at defining a dynamic and flexible tariff structure for a distribution company that protects the retail consumers against the excessive fluctuations of the wholesales market prices. We propose a two-stage pricing scheme that sets in a first-stage a time-of-use tariff that is corrected later by a dynamic component once the real-time demand has been observed. A personalized tariff scheme may be offered by a distribution company to each dynamic customer by allowing him to choose the appropriate robustness level expressed in terms of variability between the first and the second-stage decisions. The arising limited recourse model has been tested on realistic test problems, by using a slight modification of a recently proposed interior point solution framework.
Original language | English |
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Pages (from-to) | 21-36 |
Number of pages | 16 |
Journal | 4OR |
Volume | 7 |
Issue number | 1 |
DOIs | |
Publication status | Published - Mar 2009 |
Externally published | Yes |
Keywords
- Electricity market
- Pricing methods
- Stochastic Programming
ASJC Scopus subject areas
- Management Information Systems
- Theoretical Computer Science
- Management Science and Operations Research
- Computational Theory and Mathematics