Coordination of SO/sub 2/ emission allowance trading, energy and spinning reserve transactions, and consumption of take-or-pay fuels

This paper presents a method for coordinating sulfur dioxide (SO/sub 2/) emission allowance trading, energy and spinning reserve transactions, and consumption of take-or-pay fuels in the context of generation dispatch. Beginning in 1995, electric power utilities will be required by the US Clean Air Act Amendments (CAAA) of 1990 to have allowances for SO/sub 2/ emissions. In order to make the compliance program more flexible, electric utilities will be permitted to trade emission allowances. Thus it is essential to properly coordinate the emission allowance trading with other closely correlated operational decisions to achieve overall efficiency in generation dispatch. This paper presents the coordinating equations and outlines the coordination procedure. Simple examples are also given to illustrate the basic coordination principle.<
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