Energy advisory and transaction management services for self-serving retail electricity providers

• US 20050004858A1
• Filed: 08/16/2004
• Published: 01/06/2005
• Est. Priority Date: 08/16/2004
• Status: Abandoned Application

• Current Assignee: Southern Company Energy Solutions LLC (Southern Company)
• Original Assignee: Southern Company Energy Solutions LLC (Southern Company)
• Inventors: Foster, Andre E., Greiner, Kevin
• Application Number:
  US10/919,155
• Publication Number:
  US 20050004858A1
• Time in Patent Office: Days
• US Class Current: 705/36.R
• CPC Class Codes: G06Q 10/06 Resources, workflows, human or project management; Enterprise or organisation planning; Enterprise or organisation modelling
• CPC Class Codes: G06Q 40/06 Asset management; Financial planning or analysis
• CPC Class Codes: Y02P 90/80 Management or planning

Abstract

Methods for assisting and enabling a large industrial or business consumer of energy to become a self-serving retail electricity provider in a deregulated energy market. Performed by an energy advisory and transaction management service provider, one method registers the large business energy consumer with the state public utility commission, assists the business to qualify as a scheduling entity with an independent service operator, and establishes the business as a bilateral trading partner of wholesale energy merchants. In another method, the business processing outsourcing service assists the business in energy purchasing and risk management decisions by forecasting zonal load requirements for the business. A price forecasting analysis is compared with supply offers from wholesale energy merchants and bilateral transactions for energy supply are brokered between the business and the wholesale energy merchants. In another method, the business process outsourcing service assists the business to manage electronic transactions with an independent service operator and a transmission and distribution service provider. A daily load forecast for the business is updated and compared with energy purchase commitments to identify imbalances between supply and demand. The outsourcing service submits a daily schedule of forecasted sub-hourly load and purchase and sale commitments to the independent system operator. The outsourcing service receives and processes invoices from market participants and generates financial settlement reports for the business.

Claims

1. A method for enabling a business to become a self-serving retail electricity provider in a deregulated market, comprising the steps of:

registering the business as a retail energy provider with a public utility commission;

assisting the business to qualify as a scheduling entity with an independent system operator; and

establishing the business as a bilateral trading partner with a wholesale energy merchant.

2. The method for enabling a business to become a self-serving retail electricity provider of claim 1 wherein the step of registering comprises processing and managing an application filing with the public utility commission and demonstrating an electronic data interchange capability to manage transactions with the independent service operator and a transmission and distribution service provider.

3. The method for enabling a business to become a self-serving retail electricity provider of claim 1 wherein the step of assisting the business to qualify as a scheduling entity comprises processing and managing an application filing with the independent service operator and demonstrating a electronic data interchange capability to send forecasts of the business'"'"' load requirements to the independent system operator and to receive financial settlement information from the independent system operator.

4. The method for enabling a business to become a self-serving retail electricity provider of claim 1 wherein the step of establishing the business as a bilateral trading partner comprises negotiating a contract with a wholesale energy merchant.

5. A method for assisting a self-serving retail electricity provider in energy purchasing and risk management decisions, comprising the steps of:

forecasting a zonal load requirement for the self-serving retail electricity provider;

analyzing the zonal load requirement for the self-serving retail electricity provider;

establishing a supply control strategy for the self-serving retail electricity provider;

performing an energy price forecasting analysis for the self-serving retail electricity provider and comparing the forecasted wholesale energy prices with supply offers available from wholesale energy merchants; and

brokering a bilateral transaction between the self-serving retail electricity provider and the wholesale energy merchant.

6. The method for assisting a self-serving retail electricity provider of claim 5 wherein the step of forecasting a zonal load requirement comprises performing a stochastic simulation of load for the self-serving retail electricity provider.

7. The method for assisting a self-serving retail electricity provider of claim 5 wherein the step of establishing a supply control strategy comprises an evaluation of a pricing structure, a product mix, a contract length, and use of financial risk management instruments.

8. The method for assisting a self-serving retail electricity provider of claim 7 wherein the pricing structure is at least one of fixed pricing, indexed pricing, and a hybrid combination of fixed and indexed pricing.

9. The method for assisting a self-serving retail electricity provider of claim 5 wherein the step of analyzing the zonal load requirement comprises establishing a baseload energy volume and supplementing the baseload energy volume with estimates of peak period purchases, shoulder period purchases and spot market purchases to develop a volumetric energy purchasing strategy.

10. The method for assisting a self-serving retail electricity provider of claim 5 wherein the step of performing an energy price forecasting analysis comprises performing a digital simulation of marginal clearing prices and deriving a price forecast for various time-differentiated energy purchases.

11. The method for assisting a self-serving retail electricity provider of claim 6 wherein performing a stochastic simulation of load for the self-serving retail electricity provider comprises the steps of generating a deterministic load forecast, estimating stochastic parameters for use in a Monte Carlo simulation of load, and performing the Monte Carlo simulation of load.

12. The method for assisting a self-serving retail electricity provider of claim 11 wherein the step of generating a deterministic load forecast uses any one of a scale factor technique, a comparative period technique or a regression-based technique.

13. The method for assisting a self-serving retail electricity provider of claim 12 wherein the scale factor technique includes the use of scale factors that reflect a percentage difference between an actual consumption and a generalized load for the rate class that is associated with the self-serving retail electricity provider.

14. The method for assisting a self-serving retail electricity provider of claim 12 wherein the comparative period technique includes a temperature adjustment and a seasonally specific elasticity for load responses to heating and cooling degree-days, and a calendar adjustment.

15. The method for assisting a self-serving retail electricity provider of claim 12 wherein the regression-based technique includes development and use of independent forecasting equations to account for weather, or any statistically relevant variable.

16. The method for assisting a self-serving retail electricity provider of claim 11 wherein the step of estimating stochastic parameters comprises the steps of:

collecting historical load data for the self-serving retail electricity provider;

generating an hourly or sub-hourly historical load profile;

correlating the historical load profile with actual market price data for energy during a historical time period to develop a seasonal correlation between load and market price;

performing a regression analysis based on the historical load profile and actual market price data; and

selecting a stochastic estimation model that reflects a historical behavior of both load data and energy market price data for the self-serving retail electricity provider.

17. The method for assisting a self-serving retail electricity provider of claim 16 wherein the step of estimating stochastic parameters further comprises deriving a plurality of short term stochastic parameters from the stochastic estimation model.

18. The method for assisting a self-serving retail electricity provider of claim 17 wherein the short term stochastic parameters include a seasonal short-run mean reversion and volatility parameter.

19. The method for assisting a self-serving retail electricity provider of claim 17 wherein the short term stochastic parameters include a correlation between a seasonal regression residual of historical load and actual market price data.

20. The method for assisting a self-serving retail electricity provider of claim 11 wherein the step of performing a Monte Carlo simulation of load comprises running a stochastic model to simulate energy prices and load consumption.

21. The method for assisting a self-serving retail electricity provider of claim 20 wherein the stochastic model used is a two-factor lognormal mean-reverting model.

22. The method for assisting a self-serving retail electricity provider of claim 20 wherein the stochastic model generates a plurality of sub-hourly marginal clearing prices for energy and a plurality of sub-hourly loads for the self-serving retail electricity provider.

23. The method for assisting a self-serving retail electricity provider of claim 5 further comprising the step of forecasting a variable-priced index power for the self-serving retail electricity provider.

25. The method for assisting a self-serving retail electricity provider of claim 5 further comprising the step of performing a price duration analysis for the self-serving retail electricity provider by sorting the forecast of wholesale energy prices and corresponding loads into a plurality of defined price ranges.

26. The method for assisting a self-serving retail electricity provider of claim 5 further comprising the step of performing a valuation of risk management instruments for the self-serving retail electricity provider.

27. The method for assisting a self-serving retail electricity provider of claim 26 wherein the risk management instruments include at least one of a cap on an indexed-based contract, a collar on an indexed-based contract, a contract extension option and a contract-for-differences.

28. The method for assisting a self-serving retail electricity provider of claim 26 wherein the valuation of the risk management instruments depends on a strike price, a forward price and a price volatility.

24. The method for assisting a self-serving retail electricity provider of claim 24 wherein the step of forecasting a variable-priced index power comprises:

determining an indexed power volume for each hour;

determining a cost of the indexed power based on the indexed power volume and a corresponding forecast price for each hour;

determining a total cost of indexed power for all hours in an analysis period; and

displaying a graph of an annual total cost of indexed power in a plurality of annual cost ranges scaled by a probability of occurrence of each cost range.

29. A method for assisting a self-serving energy provider to manage a plurality of electronic transactions with an independent service operator and a transmission and distribution service provider comprising the steps of:

submitting a request to both the independent service operator and transmission and distribution service provider to switch a metered account to the self-serving energy provider;

updating the daily load forecast for the self-serving energy provider;

comparing the daily load forecast with a wholesale energy purchase commitment to identify periods of imbalance between an energy supply and a consumption demand for the self-serving energy provider;

submitting a daily schedule of forecasted sub-hourly load and purchase and sale commitments to the independent service operator;

receiving and processing an invoice from at least one market participant; and

generating financial settlement reports for the self-serving energy provider.

30. The method for assisting a self-serving energy provider of claim 29 further comprising the step of providing a secure, online payment system to the self-serving energy provider to review charges and to transfer funds to the at least one market participant.

31. The method for assisting a self-serving energy provider of claim 29 wherein the at least one market participant includes the independent service operator, transmission and distribution service provider, and a wholesale energy merchant.

32. The method for assisting a self-serving energy provider of claim 29 further comprising completing and providing required reports to at least one of a public utility commission, the independent service operator, the transmission and distribution service provider, and any other regulatory entity.