Short-term value for the water stored in head-sensitivity power system reservoirs

Abstract

As it is well known, competitive electricity markets require new computing tools for generation companies to enhance the management of its resources. The economic value of the water stored in a power system reservoir is crucial information for enhancing the management of the reservoirs. This paper proposes a practical deterministic approach for computing the short-term economic value of the water stored in a power system reservoir, emphasizing the need to considerer water stored as a scarce resource with a short-term economic value. The paper addresses a problem concerning reservoirs with small storage capacities, i.e., the reservoirs considered as head-sensitivity. More precisely, the respective hydro plant is head-dependent and a pure linear approach is unable to capture such consideration. The paper presents a case study supported by the proposed practical deterministic approach and applied on a real multi-reservoir power system with three cascaded reservoirs, considering as input data forecasts for the electric energy price and for the natural inflow into the reservoirs over the schedule time horizon. The paper presents various water schedules due to different final stored water volume conditions on the reservoirs. Also, it presents the respective economic value of the water for the reservoirs at different stored water volume conditions.