Energy Contract Research Articles

A fix-and-relax heuristic for the single-item lot-sizing problem with a flow-shop system and energy constraints

This study addresses a new single-item lot-sizing problem for flow-shop configurations by integrating the capacity contract selection problem with multiple energy sources. To the best of our knowledge, this problem has never been tackled before. We introduce a mathematical model which defines optimum production plan and energy contract option regarding the objectives and constraints of the production system and energy supplier contract conditions. Since the problem is NP-Hard, a Fix-and-Relax heuristic is introduced to solve the problem. Two different relaxation procedures are applied and the performance of the solution approach is tested on randomly generated instances. It is seen that the obtained results are quite promising. The applied heuristic approach produces solutions with the optimality gap in average for the small problem sizes such as (N5_T5,N5_T7). For the larger instances, it allows to reach better results than the results obtained by commercial solvers within a shorter time.

Multisources of Energy Contracting Strategy with
 an Ecofriendly Factor and Demand Uncertainties

This study presents a mathematical formulation to optimize contracting capacity strategiesof multisources of energy for institutional or industrial consumers considering demand uncertainties.The objective consists of minimizing the total costs composed of the different types of energy contractcapacity costs, penalty price, and an ecofriendly factor. The penalty price is charged on the demand ofenergy exceeding the total contract capacities. The ecofriendly factor encourages the use of renewableenergy and reduces the traditional energy used in the optimal mix of energy sources. The proposedmodel is tested based on demand of energy inspired from real data. These numerical experiments areanalyzed to illustrate the impact of encouraging the use of renewable energy sources by introducingthe ecofriendly factor and the influence of penalty price and uncertainty in the demand of energy.The results show that in the presence of low penalty price or low uncertainty a large amount ofecofriendly support is needed for using more renewable energy sources in the optimal contractcapacity combination.

Pointwise stability of shock wave for 2D anisotropic viscous conservation laws with large perturbation

In this paper, we are interested in the well-posedness of solutions for anisotropic scalar conservation law with large perturbation around the planar shock wave in two dimensional space. It is shown that the Cauchy problem admits a global classical solution by using the classical energy estimates and contraction property, while the initial perturbation is bounded in given space, where we used some new inequalities for anisotropic terms which was imposed in Lemma 2.7. Moreover, we obtain the pointwise estimates of the solutions for fractional order dissipation in y-direction by the formula of Green’s function.

LNG Maritime energy contracting model

To meet the global 2020 low sulphur demand and beyond, the supply of low sulphur fuel must increase and expand. So far, the world bunker market is split between the different compliance solutions increasing demand for sulphur compliant fuel. The work examines the implementation of an innovative business model initially designed to meet energy needs. The developed model facilitated a sustainable LNG supply/distribution process economically and was further tested with a real-life case example that shows the cost structure for the proposed model. Both quantitative and qualitative data approaches were used to collect data. The illustrated modified features of the LNG maritime energy contract model accentuate an analytical and unconventional strategy embedded in experimentation.

Application of Blockchain Technology in Energy Internet Market and Transaction

Based on the blockchain technology, important datas such as transactions, scheduling, finance, and energy contracts are distributedly recorded, various resources such as distributed energy generation, energy transmission, energy consumption, and energy storage are aggregated for collaborative optimization control and market trading. In this paper, we build blockchain-based new generation energy Internet with extensive interconnection, intelligent decision making, real-time interaction, and open sharing. The application of blockchain technology in energy Internet includes photovoltaic energy microgrid, blockchain-based energy Internet entities, blockchain-based power trading, and energy asset securitization. Technical frameworks for energy Internet market trading system based on blockchain technology are proposed. Distributed energy ledger and energy trading smart contract are utilized. Distributed trading rules, algorithms and processes of energy system and microgrid are established. Energy Internet transactions and payment settlement system are constructed. Energy producers and consumers trade peer-to-peer on the platform to improve system efficiency and security.

The use of Private and Public Land for the Development of Heat Networks

District heating is a form of decentralized energy that has the potential to play a key role in stabilizing climate change. To dispense this decentralized energy from the heat source to the end-users, a heat network is needed. To realize (the potential of) these networks, there are a wide variety of issues to consider and barriers to overcome. Law plays an important role in framing understandings of both heat networks and the legal design with regard to these networks. The article focuses on the legal challenge of land use to develop heat networks. Since developers do not have property rights on all the plots of land they want to use to realize their hear project, they need to secure appropriate land rights in order to locate their network in third party land. These land rights can be included in various legal instruments. It needs to be precisely determined what kind of rights one can obtain and which of those rights would be the most suitable for a particular district heating project. The findings of the analysis indicate that a “one size fits all”-model is not the most appropriate policy to address issues on the complex and evolving crossroads of energy law, property law and contract law. A customized legal design is necessary to synchronize the interests of all stakeholders involved.

A novel decision strategy for a bilateral energy contract

Due to the relatively high transportation cost of energy in remote regions, an effective and efficient energy trading market is required. In this paper, first, we extend the idea of a smart home community architecture comprising a small number of smart homes that suit these sorts of regions. Second, we propose an energy trading market at two levels. At the top-level, global generators and global consumers participate in energy trading. At the second level, smart homes in a smart home community participate in the energy market as local generators and consumers. Third, we develop a bilateral energy trading scheme and a novel decision strategy for choosing a bilateral price for both seller and buyer. The developed strategy and energy trading schemes are more efficient than those proposed in traditional work as they require far fewer rounds for negotiations between buyers and sellers to arrive at a mutually appropriate bilateral price. Fourth, we present two distinct cases for bilateral energy trading; single seller single buyer and single seller multiple buyers and show that the latter case has more benefits for both the seller and the buyer. Lastly, we conduct a series of experiments to illustrate the effectiveness of the proposed work.

Participation of an Energy Hub in Electricity and Heat Distribution Markets: An MPEC Approach

Integration of electricity and heat distribution networks offers extra flexibility to system operation and improves energy efficiency. The energy hub (EH) plays an important role in energy production, conversion and storage in such coupled infrastructures. This paper provides a new outlook and thorough mathematical tool for studying the integrated energy system from a deregulated market perspective. A mathematic program with equilibrium constraints (MPEC) model is proposed to study the strategic behaviors of a profit-driven EH in the electricity and heating markets under the background of energy system integration. In the upper level, the EH submits bids of prices and quantities to a distribution power market and a heating market. In the lower level, these two markets are cleared and energy contracts between the EH and two energy markets are determined. Network constraints of physical systems are explicitly represented by an optimal power flow problem and an optimal thermal flow problem. The proposed MPEC formulation is approximated by a mixed-integer linear program via performing integer disjunctions on the complementarity and slackness conditions and binary expansion technique on the bilinear product terms. Case studies demonstrate the effectiveness of the proposed model and method.

Volatility Uncertainty Quantification in a Stochastic Control Problem Applied to Energy

This work designs a methodology to quantify the uncertainty of a volatility parameter in a stochastic control problem arising in energy management. The difficulty lies in the non-linearity of the underlying scalar Hamilton-Jacobi-Bellman equation. We proceed by decomposing the unknown solution on a Hermite polynomial basis (of the unknown volatility), whose different coefficients are solution to a system of non-linear PDEs of the same kind. Numerical tests show that computing the first basis elements may be enough to get an accurate approximation with respect to the uncertain volatility parameter. We experiment the methodology in the context of swing contract (energy contract with flexibility in purchasing energy power), this allows to introduce the concept of Uncertainty Value Adjustment (UVA), whose aim is to value the risk of misspecification of the volatility model.

External Financing and Industrial Growth in Nigeria

This study examined the potential of external financing in spurring industrial growth in Nigeria within the period of 1985-2018. The study used Industrial Output (INDO), External Loans (EXL), Foreign Direct Investment (FDI), Remittances (RIMT), Gross Fixed Capital Formation (GFCF), Industrial Energy Consumption (IEC) and Contract Intensive Money (CIM) as variables in estimating the relationship. The study hinged on Great Big Push Theory and Kaldor’s First Law and adopted the Autoregressive Distributive Lagged (ARDL) bound approach as the estimation technique. The findings revealed that, a positive relationship exists between EXL and INDO while FDI and RIMT exerts a negative effect on industrial growth. The control variables further showed that GFCF, IEC, CIM exerts positive influence on industrial growth. Since only EXL exerts positive influence on INDO, the study concludes that external financing (that is, FDI and RIMT) has not yielded the desired effect on industrial growth in Nigeria. The study recommended amongst others that; public-private partnership, is necessary to spur the industrial sector activities with strong institutional setup.

Single Item Lot Sizing Problem Under Renewable Energy Uncertainty

Abstract Renewable energy sources play an important role to decrease the dependency to the traditional energy sources which are responsible for the high carbon emission levels in the world. The main challenge in the use of the renewable energy sources in the industrial sector, which has the highest energy consumption share among the others, is to plan the production considering the risk of discontinuity in the supply of the renewable energy sources due to their stochastic nature. In this paper, a single item lot sizing problem under uncertain renewable energy availability is addressed. The aim is to determine the optimal production plan and energy contract option which minimizes the total production and energy costs by guaranteeing to satisfy the external demand with a given service level. To do so, two types of chance constraints are introduced to cope with the stochastic availability of the renewable energy sources. The developed model is explained in detail and illustrative examples are presented and the findings are discussed briefly.

Micro and Small Businesses’ Satisfaction With the UK Energy Market: Policy Implications

While householders’ ability to navigate the domestic retail energy market has generated considerable debate, little attention has been given to micro and small businesses’ (MSBs) purchasing of energy. This paper provides the first academic assessment of MSBs’ satisfaction with the UK’s retail energy market. Using survey data from the UK energy regulator we find that while intermediaries are central to MSBs switching energy supplier, the quantity of marketing contact received from them is a key source of dissatisfaction. This dissatisfaction with marketing contact has direct policy relevance as the Competition and Market Authority’s 2016 Energy Market Investigation recommended that a database of ‘disengaged’ MSBs be established to enable marketing communications from rival suppliers to prompt MSBs to switch. We also query whether the need for more MSB engagement is obvious, given the prevalence of multi-year energy contracts among MSBs, suggesting that the ‘optimal’ switching level of MSBs likely differs from that of householders. Our evidence suggests that there could be benefits from increased regulatory oversight of intermediaries’ behaviour. Furthermore we note that existing data fail to address an issue of importance for regulatory decision making: the overlap between households and MSBs and the potential choice for MSBs between domestic and non-domestic contracts. Overall, the paper exemplifies the types of insights that can be obtained by regulators providing wider access to the surveys they commission. We recommend that UK regulatory agencies share anonymised raw survey data by default to enhance the transparency, and potentially quality, of their decision making.

Curtailment of renewable energy in Northwest China and market-based solutions

In 2016, solar and wind energy production were greatly curtailed in China, especially in its northwestern region. This paper identifies administrative factors and market barriers as the main causes of renewable curtailment. In 2017, the Northwest Power Grid (NWPG) successfully implemented a variety of approaches to reduce wind and solar curtailment. In this paper, we analyze the change in power generation, expansion of renewable energy delivery, and electricity-replacement projects across provinces that occurred in 2017. While acknowledging the practical results of the NWPG's efforts, we identify challenges that the northwest still faces in integrating renewable energy. We argue that trans-regional administrative barriers are preventing the effective utilization of renewable energy nationwide. To address those barriers, we explore market-based mechanisms for promoting the integration of large-scale renewable energy. In addition to long-term contracts for renewable energy across provinces, both spot-market and the ancillary service market would facilitate the uptake of renewable energy. In addition, price signals should be used to guide peak shaving. Market mechanisms will be insightful to dissolve barriers and enhance utilization of renewable energy throughout the country.

Surface Ligand Management for Stable FAPbI3 Perovskite Quantum Dot Solar Cells

Summary In contrast to conventional colloidal quantum dots (CQDs), management of insulating ligands on perovskite CQDs is challenging because their ionic bonds are highly vulnerable to polar solvents. Consequently, there have been only a few examples of perovskite CQD solar cells incorporating relatively robust inorganic perovskite of which optoelectronic properties are not ideal for photovoltaic devices. Here, we report efficient and stable CQD solar cells based on formamidinium lead triiodide (FAPbI3) CQDs realized by rational surface regulation. Tailoring polarity of antisolvents for the post-synthetic process enabled effective removal of the insulating ligands on FAPbI3 CQDs while preserving perovskite cores. Owing to the enhanced inter-dot electrical coupling, a power-conversion efficiency of 8.38% was demonstrated. Furthermore, the FAPbI3 CQDs-based devices showed superior stability over those of bulk FAPbI3 devices. Thermodynamic and crystallographic analyses revealed that enhanced contribution of the surface energy and lattice contraction contribute to their superior stability.

Context aware Q-Learning-based model for decision support in the negotiation of energy contracts

Automated negotiation plays a crucial role in the decision support for bilateral energy transactions. In fact, an adequate analysis of past actions of opposing negotiators can improve the decision-making process of market players, allowing them to choose the most appropriate parties to negotiate with in order to increase their outcomes. This paper proposes a new model to estimate the expected prices that can be achieved in bilateral contracts under a specific context, enabling adequate risk management in the negotiation process. The proposed approach is based on an adaptation of the Q-Learning reinforcement learning algorithm to choose the best scenario (set of forecast contract prices) from a set of possible scenarios that are determined using several forecasting and estimation methods. The learning process assesses the probability of occurrence of each scenario, by comparing each expected scenario with the real scenario. The final chosen scenario is the one that presents the higher expected utility value. Besides, the learning method can determine which is the best scenario for each context, since the behaviour of players can change according to the negotiation environment. Consequently, these conditions influence the final contract price of negotiations. This approach allows the supported player to be prepared for the negotiation scenario that is the most probable to represent a reliable approximation of the actual negotiation environment.

Formulation of Interstate Energy Contract Target Based on Optimal Energy Structure

The production and usage of energy are crucial to the economic development and environmental protection. Along the U.S. border with Mexico, there are four states – California, Arizona, New Mexico, and Texas. We take the data of 605 variables in 50 variables of four states as samples and combine demographic and economic information to analyze. Firstly, we use decision tree algorithm to describe the evolution characteristics of each energy distribution and establish energy decision analysis model. Secondly, we establish an energy profile evaluation model based on the analytic hierarchy process. Then, the states were given a certain amount of importance and put in the judgment submatrix. According to results, California scores the highest, which means it has the best energy structure. Thirdly, we use the grey prediction method to deduce the amount of energy consumption and economic status from 2010 to 2050. It’s worth noting that how to determine interstate energy contracts in four states should take into account the best energy structure and four state energy standards. We choose the best energy structure as the reference target to formulate the energy agreement. Finally, we made some constructive recommendations toward the development blueprint of the interstate energy contract.

Multivariate dependence analysis via tree copula models: An application to one-year forward energy contracts

We propose a novel multivariate approach for dependence analysis in the energy market. The methodology is based on tree copulas and GARCH type processes. We use it to study the dependence structure among the main factors affecting energy price, and to perform portfolio risk evaluation. The temporal dynamic of the examined variables is described via a set of GARCH type models where the joint distribution of the standardised residuals is represented via suitable tree copula structures. Working in a Bayesian framework, we perform both qualitative and quantitative learning. Posterior summaries of the quantities of interest are obtained via MCMC methods.

Maritime Energy Contracting for Clean Shipping

Abstract To reduce the Sulphur emission from shipping and ensure clean shipping, a number of Sulphur Emission Control Areas (SECA) were enforced in special areas around the globe. From 2015, in SECA, ship owners are not allowed to use fuel with more than 0.1% Sulphur content. One of the major concerns for the SECA regulation is that maritime stakeholders have had to take into consideration the costs as well as the tolerable risks of their compliance investment options. Besides that, low freight rates have increased the competition and had caused financial pressure on ship owners so that lower capital reserves and low credibility levels limit the manoeuvring space for investment activities. The indications from BSR after 2015 showed that the low fuel price has eased the economic effects of the SECA regulation and as a result, most ship owners have delayed their investment decisions. Even though the postponement of emission abatement techniques seems to have reduced the compliance expenses for SECA, they, however, did not improve the position of shipowners relative to their competitors. Consequently, new policy instruments to stimulate innovation, to raise competitiveness and to comply with the new environmental regulations are needed. It would have been easier to hedge fuel price volatility and offer maritime logistics services for a lower price, but to be able to ensure sustainable results in long-term, maritime stakeholders must be ready to device astute strategies that can propel them to unparalleled advantage. This research first appraised the investment risks and payback period associated with the scrubber using different capital budgeting methods. It further illustrated the Maritime Energy Contracting (MEC) model as a market mechanism for the delivery of a cost-effective emission reduction using the scrubber technology as well as an instrument to realise a competitive advantage for ship operators. The results are empirically validated by case studies from BSR.

Energy Contract Optimization for the Single Item Lot Sizing Problem in a Flow-Shop Configuration and Multiple Energy Sources

In this paper, a new single item lot sizing problem, including different energy sources is addressed. The objective is to determine the optimal production planning and energy contract which minimize production and energy costs with respect to constraints of production systems and energy supplier contract conditions. Two types of energy sources (traditional and renewable) are considered. The choice of energy contract value is also addressed in terms of capacity. The proposed model is explained and illustrated with numerical examples. Computational results are exposed to evaluate the proposed model.

Turkey’s Energy Strategy for 2023 Targets after 2000 MW Giant Renewable Energy Contract

Turkey wants to become the world’s 10th largest economy in the 100th anniversary of the foundation of the republic of Turkey. In order to achieve this goal, there are many breakthroughs in the political, economic and in energy fields. Turkey’s installed power capacity was 85000 MW in 2017 but installed power of 125.000MW is targeted to achieve the objective of 2023 targets. The government is aiming to increase the total production of renewable energy share by 30% in 2023, while foreseeing the increase in capacity due to nuclear and fossil fuel consumption. Targets for different technologies are 34000 MW hydroelectric, 20000 MW wind energy, 5000 MW solar energy (photovoltaic and condensed solar energy), 1000 MW geothermal energy and 1000 MW biomass. Capacity utilization in hydroelectricity is 62%, wind power is 14%, and geothermal power is 33%. The total installed capacity of Biogas, Biomass, Waste Heat and Pyrolytic Oil Power Plants is 530 MW. Theoretical total power capacity of the solar energy for Turkey as 300 TWh/year and reached 45% of the 2023 target in 2017 in the last three years. However, it is estimated that the targets of 2023 in solar energy can be exceeded. Government offers attractive incentive packages for renewable and other energy sector to achieve 2023 goals. In order to encourage domestic production, a total of 2000 MW wind and solar energy installation bid was carried out in 2017. This contract is expected to make Turkey as energy hub both in terms of installation and technology. In this study, Turkey’s renewable energy potential, and energy strategies and breakthroughs for this were investigated and discussed.