Dynamic Sale Price Setting for Load Serving Entity’s Profit Maximization

摘要

This paper presents an optimization model to determine optimal dynamic sale prices and optimal energy procurement decisions of a load-serving entity (LSE) in the presence of solar energy for consumer’s elastic demand. LSE determines these decisions to maximize its profit at a given level of risk. Consumer’s elastic demand is considered by its price elasticity, and price uncertainty is modeled using the mean-variance approach. Optimal decisions of risk-neutral and risk-averse LSE are illustrated through a case study. Results indicate that LSE builds consumer demand by lowering sale prices during solar energy availability hours to utilize it optimally.