Choosing an integrated resource plan for electric utilities: an analytic hierarchy approach

Abstract

The objective of this research is to test an analytic hierarchy process (AHP) approach to integrated resource planning (IRP) for electric utilities in developing countries. We demonstrate how the AHP may be used in a multiple criteria framework for an effective group decision process for the IRP. We show in practice how the AHP may be used to evaluate the scenario probabilities, criteria weights, and uni-dimensional utility functions. A case study is undertaken at the Barbados Light and Power Company (BL&P) on the island nation of Barbados, where we solicit the judgment, trade-offs of a six member group of utility experts. We successfully re-visited the BL&P's 1988 resource expansion decision, and discovered and recorded the probable judgments and trade-offs made by the Company that lead to a robust preference for efficient oil fired plant rather than switching to natural gas or coal. We identified, ranked, and rated the corporate performance criteria and planning objectives, as well as a broad spectrum of external and internal business factors that impact on the choice of a resource plan.