Analysis on various pricing scenarios in a deregulated electricity market
The electricity pricing structure in Texas has changed after deregulation (January2002). The Energy Systems Laboratory has served as a technical consultant onelectricity purchases to several universities in the Texas A&M University System since2001. In the fiscal year of 2006 Stephen F. Austin State University joined with theTAMU campuses and agencies, and there are now 183 accounts in the ElectricReliability Council of Texas (ERCOT) North, Northeast, South, West, and Houstonareas of Texas. From the 183 accounts, 9 Interval Data Recorder (IDR) accountsconsume 92% of the total load. The objective of this research is to find the mosteconomic price structure to purchase electricity for the Texas A&M System and StephenF. Austin University by analyzing various pricing scenarios: the spot market, forwardcontracts, take or pay contracts and on/off season (tiered) contracts. The analysis wasbased on the 9 IDR accounts. The prices for the spot market were given by ERCOT andthe other prices by Sempra. The energy charges were calculated every 15 minute usingthe real historical consumption of each facility and the aggregated load of all facilities.The result for the analysis was given for each institution separately, as well as for the aggregated load of all facilities. The results of the analysis showed that the tiered pricewas the most economical structure to purchase electricity for each individual universityand for the total aggregated load of all 9 IDR accounts. From March 1, 2005 to February28, 2006, purchasing electricity on the tiered price would have cost $13,810,560. Theforward contract, that is, purchasing electricity on a fixed rate, was the next cheapestwith an energy cost of $14,266,870 from March 1, 2005 to February 28, 2006, 3%higher than purchasing electricity at the tiered price. The most expensive method topurchase electricity would have been the spot market. Its energy costs would have beenapproximately $18,171,610, 36% and 31% higher, respectively, than purchasingelectricity at the tiered price and the fixed rate.
Year of publication: |
2006-08
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Other Persons: | Turner, Dan W. (contributor) |
Publisher: |
Texas A&M University |
Subject: | deregulation | texas |
Saved in:
freely available
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