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We propose a stochastic linear programming model for constructing piecewise-linear bidding curves to be submitted to Nord Pool, which is the Nordic power exchange. We consider the case of a price-taking power marketer who supplies electricity to price-sensitive end users. The objective is to minimize the expected cost of purchasing power from the day-ahead energy market and the short-term balancing market. The model is illustrated using a case study with data from Norway.
Date of Publication: May 2005