Risk management system for electric utilities

Claim 1

In a risk management system that schedules generating units of an electric utility while taking into consideration power trading with other utilities and a stochastic load on the utility system, a computer implemented method comprising the steps of: inputting load forecast, trading forecast and generator and fuel properties; generating load scenarios as a scenario tree that approximates future uncertainties in load and trades; computing an initial approximate value for the cost per British Thermal Unit (BTU); obtaining a load on each generator under any scenario and, given the load on each generator, determining an optimal fuel allocation to obtain a cost function of generating a Megawatt Hour (MWH) of power on each generator; solving a stochastic unit-commitment model to obtain a generation of each unit at each time period under different scenarios which can be used to compute heat-input needed for each unit throughout a planning horizon; solving a linear program in which decision variables are amount of fuel burnt on each unit at each time period, wherein decision variables have a component for each possible fuel in the model and the linear program is solved subject to a constraint that fuel fed to a generator must be sufficient to generate the heat needed; determining if a current fuel allocation is the same as before and, if not, computing a new cost function for each generator for all fuels fed to a given generator, the new cost function being used in resolving unit commitment; repeating the steps of solving the stochastic unit-commitment model until the fuel mixtures and the load on the generators approach an optimal solution; and outputting fuel consumption, generation requirement and load for each generator of the utility at each period and the fuels to be used.