Risk Modeling and Strategic Choices in an Uncertain Environment. Case of a Swiss Power Provider on the eve of Electricity Market Opening
Nguene Nguene, Gustave ; Finger, Matthias
In: Proceedings, International Urbistics2005, New Trends in the Integrated Urban Development, 2005, p. 1-12
With electricity market liberalisation, the task of decision makers is becoming more and more difficult. In this framework, strategic portfolio choice has become very complex, because of the growing number of uncertain parameters involved, such as energy market prices, water inflow, and demand. The lack of information and the absence of the decision maker’s perception are just some of the many... Plus
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- With electricity market liberalisation, the task of decision makers is becoming more and more difficult. In this framework, strategic portfolio choice has become very complex, because of the growing number of uncertain parameters involved, such as energy market prices, water inflow, and demand. The lack of information and the absence of the decision maker’s perception are just some of the many elements that must be accounted for. Therefore, the objective of this paper is to propose a methodology based on strategic choices that will enable decision makers to evaluate the performance of both their strategies and portfolios, through the computation of an indicator for different time horizons. This indicator is used to evaluate and select portfolios of customers. With the use of fuzzy numbers theory, this methodology will enable decision makers to incorporate and express uncertainty, in a non probabilistic sense. With the Swiss electricity market moving towards deregulation, the degree of competition is set to increase. In this context, some energy intensive industries have created their own electricity companies, as one of their divisions, in order to be able to secure the cheapest possible power provision for their processes. The case of this kind of market player is examined.