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Modeling Dependent Outages of Electric Power Plants

Author

Listed:
  • Vishwakant Malladi

    (Indian School of Business, Mohali, Punjab 140 306, India)

  • Rafael Mendoza-Arriaga

    (Man GLG, London EC4R 3AD, United Kingdom)

  • Stathis Tompaidis

    (Department of Information, Risk, and Operations Management, University of Texas at Austin, Austin, Texas 78712)

Abstract

We propose a framework to model dependence of outages of electric power plants. Our framework allows for common factors, such as weather events and fuel shortages, to drive outages. We calibrate our model for power plants in the Electric Reliability Council of Texas and the Western Electricity Coordinating Council regions using a unique data set of actual outages from the North American Electric Reliability Corporation. We find strong evidence of dependence in power plant outages based on the input fuel of the plants and illustrate how our framework can be used to evaluate the reliability of the supply of electricity for both regions, and also the impact on reliability of building additional capacity.

Suggested Citation

  • Vishwakant Malladi & Rafael Mendoza-Arriaga & Stathis Tompaidis, 2020. "Modeling Dependent Outages of Electric Power Plants," Operations Research, INFORMS, vol. 68(1), pages 1-15, January.
    • Handle: RePEc:inm:oropre:v:68:y:2020:i:1:p:1-15
    DOI: 10.1287/opre.2019.1952
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    References listed on IDEAS

    as
    1. Ross Baldick & Sergey Kolos & Stathis Tompaidis, 2006. "Interruptible Electricity Contracts from an Electricity Retailer's Point of View: Valuation and Optimal Interruption," Operations Research, INFORMS, vol. 54(4), pages 627-642, August.
    2. Rafael Mendoza-Arriaga & Vadim Linetsky, 2016. "Multivariate Subordination Of Markov Processes With Financial Applications," Mathematical Finance, Wiley Blackwell, vol. 26(4), pages 699-747, October.
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