Modeling dispatch constraints in production cost simulations based on the equivalent load method

This paper presents a new rigorous and efficient algorithm to model a very general class of dispatch constraints in production cost simulations based on the equivalent load method. The facet algorithm is based upon two observations: the equivalent load production cost calculation is a linear program, which can incorporate dispatch constraints as additional linear inequalities; it has a special structure which admits an efficient, specialised solution algorithm. This paper gives an intuitive, graphical demonstration of the algorithm and works out a detailed example. It also discusses the types of generating technologies and dispatch constraints which can be modeled