Daily Exchange on Price Cap Contract Type
This contract type will buy and sell energy on a given day based upon the daily price pre-forecast and the input price cap. A reference to a Weekly Vector should be entered in the Shape column to determine how the energy will be exchanged throughout a given day. On hour 1 of each day, a check is made to see if the daily price forecast (as determined by the internal pre-forecast) is greater than or equal to the price cap. If it is, then the energy exchanged each hour of that day is determined by the 24 corresponding shape factors in the weekly vector.
Let n = the number of times (out of 24) the shape factor is 1, and let [Exchange Factor] = -n/(24-n). Then the energy each hour will be determined as follows:
- If the shape factor is 1 for the hour, then [Energy] = [Energy Max]*[Monthly Shape]
- If the shape factor is not 1, then [Energy] = [Exchange Factor]*[Energy Max]*[Monthly Shape]
This formulation ensures that the total net energy for a given day is zero (unless the 24 shape factors are all 1). If the daily price forecast is less than the price cap, then no energy is exchanged during that day. The cost of the contract will be determined solely by the capacity cost applied.
Daily Exchange on Price Cap Contract Type
