Insurance Premium Setting Based On Power System Reliability Analysis

With the deepening of power system reform and the wide application of renewable energy generation. Consumers need more reliable power systems. An insurance premium based on power system reliability analysis is presented in this paper presents. This method embeds system reliability into actuarial science. Based on the outage losses from reliability analysis, premiums are calculated for different kinds of users. And then an advanced principle of value-at-risk is used to improve the computational methods of premium. Firstly, Monte Carlo method is used in the analysis of power system reliability. Secondly, the model of outage loss is designed according to the failure time, and the characteristics of different power customers are taken into account. Finally, considering the value-at-risk theory, the loss of power outage is used to calculate the premiums. The application of insurance mechanisms to power systems can provide users with an economic method to avoid major unexpected losses.