School Seminars and Colloquia

Modelling Carbon Emissions Reduction from the Australian Electricity Sector


by Deb Chattopadhyay - Principal

Institution: CRA International
Date: Fri 29th February 2008
Time: 3:15 PM
Location: Theatre 3, ICT Building (111 Barry St, Carlton) Uni of Melb

Abstract: Carbon emissions reduction has been a central part of public policy debates in recent years. Yet, there has been relatively little effort to explore the cost implications for alternative greenhouse gas (GHG) policies such as a mandatory introduction of renewable energy vis-Ã -vis an emissions trading scheme. We will first review the background GHG policy issues and choices within the electricity sector.

This study uses a set of mathematical programming models to analyse the
optimal choice of technology and quantitatively address the implications for alternative GHG policies. There are two core models. The first model characterises the interaction among the players in the Australian National Electricity Market (NEM) as a non-cooperative Cournot game to determine
the profit maximising generation strategy for the generators. This model
is solved iteratively with a stochastic LP that mimics the centralised production scheduling performed by the electricity market operator. The Cournot game is formulated as a mixed complementarity problem (MCP) and is solved to obtain the equilibrium generation strategy for each generator over a number of years. The stochastic LP solves for the long-term investment and production schedule for all electricity generators in the system. An overview of these models will be provided.

For More Information: Konstantin Borovkov