Company Mark-up Bias

Units:	-
Mode:	Input Only
Multi-band:	False
Default Value:	0
Validation Rule:	Any Value
Key Property:	No
Description:	Bias given towards high revenue periods in mark-ups (cost recovery algorithm)

Company Mark-up Bias is used in the LRMC Recovery algorithm in it's calculation of Generator Mark-up. It is used to bias mark-ups towards high revenue periods by changing the Revenue Recovery Factors, which are based on the profile of Generator Pool Revenue. This has the effect of tilting the resulting price duration curve to give higher peak and lower off-peak prices.

The effect of various values of Mark-up Bias on the revenue recovery factors is illustrated in Figure 1. Here a simple wave shape is increasingly biased as the value moves from 0 to 5.

Figure 1: The effect of Mark-up Bias on Revenue Recovery Factors