A Comparative Study of Stochastic Models for Forecasting Electricity Generation and Consumption in Nigeria

Bridget Nkemnole,University Of Lagos ,Mohd Akinola

doi:10.22178/pos.62-3

Abstract

With energy serious shortage of the Nigerian Power Sector owing to industry deregulation, abrupt variations in electricity demand, and increasing population density, Nigeria's economic development has been restricted. Thus, it is signiﬁcant to balance the relationship between power generation and consumption, and further stabilize the two in a reasonable scope. To achieve balance, an accurate model to fit and predict electricity generation and consumption in Nigeria is required. This study, therefore, proposes a comparative study on stochastic modeling; (Harvey model, Autoregressive model, and Markov chain model) for forecasting electricity generation and consumption in Nigeria. The data gathered were analyzed and the model parameters were estimated using the maximum likelihood estimation technique. The comparative performance revealed that the Markov chain model best-predicted electricity generation than the Harvey and Autoregressive models. Also, for electricity consumption, results showed that the Harvey model predicted best than the Markov and Autoregressive models for electricity consumption. Thus, the Markov and Harvey model used to forecast electricity generation and consumption in Nigeria for the next 20 years (2018 to 2037) did not only reveal that electricity generation and consumption will continue to increase from 3,692.11 mln kW/h to 18,250.67 mln kW/h and from 2,961.10 mln kW/h to 127,071.30 mln kW/h respectively but also indicates high accuracy and the reference value of these models.

Highlights

The generation of electric power in Nigeria is overwhelmed by excessive demand for electricity by consumers because of inadequate supply
The proposed models (Harvey model, Autoregressive model, and Markov chain model) discussed in the previous section are applied to model electricity generation and consumption in Nigeria between 1990 and 2017
The models would be fitted on the historical data of electricity generation and consumption in Nigeria and the best model would be used to forecast electricity generation and consumption for the twenty years; (2018-2037)

Summary

Introduction

The generation of electric power in Nigeria is overwhelmed by excessive demand for electricity by consumers because of inadequate supply. This supply shortfall has resulted in prolonged and intermittent power outages supplies to the consumers over the years. Growth results in an increase in power demand, which certainly requires planning ahead of time to meet the present and future demand for uninterruptible power supply [2]. Forecasting electricity generation and consumption with high accuracy is important as it helps to plan production along with required demand in advance and prevent energy wastage and system failure. Accurate forecast leads to increase the reliability of power supply, precise decision making for future development, quality savings in operation, and maintenance costs [3]. A safe and reliable source of electricity involves a feasible and practical method for demand forecasting

Methods

Results

Conclusion