Shortage of electric energy is one of the major problems in developing countries, especially in Southeast Asia. The energy producing companies are facing a challenge of meeting increasing demand with significant peak and base load differences with hydro-electric projects. The variability in energy demand (hourly and seasonal) and seasonal changes in streamflow availability to harness energy complicate the design and regulation of a hydro-electric project. A system dynamics model was developed for a hydro-electric project in Nepal with the variable energy demand and the availability of streamflow as the primary control parameters. Analyses were conducted to determine the effect on electricity production from the plant in a year among the various scenarios. An installed capacity of 12 megawatts and storage capacity of 750,000 cubic meters was determined to be a threshold for steep increment in electricity production for the simulated demand. The growth in national installed capacity showed non-linear decrease in electric production from a plant while an increase in electricity demand and its variation showed a non-linear increase. Such models for hydro-electric plants may be helpful in selecting the appropriate storage and installed capacity under variable demand and supply conditions and possible future scenarios.
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