Risk evasion contract design for distribution utility based on incentives theory

Author

Dengwei Duan ; Liu, Junyong ; Wu, Jiguang

Author_Institution

Dept. of Electr. Eng., Sichuan Univ., Chengdu, China

Volume

2

fYear

2004

fDate

5-8 April 2004

Firstpage

708

Abstract

Distribution utilities are facing enormous risks in market environment. The causes of risks are analyzed and a risk-evasion contract design method is presented based on incentives theory and load management techniques. The contract design is to help the utility evade risks by encouraging customers´ to actively apply load management behaviors. Principal-agent model is employed in risk-evasion incentive contract design. The utility´s optimal contracts are developed with considering risk-averse and risk-taker customers respectively, the correlation of market price and retail price is also considered in contract design. The simulation results show the feasibility of proposed methods in evasion risks of spot market.

Keywords

incentive schemes; load management; power markets; power system simulation; pricing; risk analysis; distribution utility; electricity markets; incentives theory; load management techniques; market price; principal-agent model; retail price; risk analysis; risk evasion contract design; risk-averse customers; risk-taker customers; utility optimal contracts; utility regulation; Contracts; Design methodology; Elasticity; Electricity supply industry; Electricity supply industry deregulation; Energy consumption; Load management; Power generation; Power industry; Risk analysis;

fLanguage

English

Publisher

ieee

Conference_Titel

Electric Utility Deregulation, Restructuring and Power Technologies, 2004. (DRPT 2004). Proceedings of the 2004 IEEE International Conference on

Print_ISBN

0-7803-8237-4

Type

conf

DOI

10.1109/DRPT.2004.1338075

Filename

1338075