Strategy & Operations > Strategic Resource Optimization

Power Generation: Strategic Resource Optimization

Electric power generators face unprecedented uncertainty in the form of looming regulatory requirements, uncertain demand, renewables mandates, new technologies and fuel price volatility. In the face of this uncertainty, utilities need to develop an optimal asset strategy plan for existing and new electricity sources.

Advanced Analytical Consulting Group's Strategic Resource Optimization (SRO) framework provides a fully integrated modeling capability to evaluate least-cost capacity expansion, retirements and emission control strategies for meeting energy demand and meeting/exploiting current and emerging emissions limits/markets.

SRO: EXAMPLES OF QUESTIONS ANSWERED

Tactical

Should existing large coal-fired units be retrofit with SCRs and scrubbers or converted to burn natural gas?
Which older uncontrolled coal units should be retired and when?
How does the flexibility of mothballing units compare with the savings of retiring them?

Strategic

Clean coal, gas-fired combined cycle or nuclear for new base-load plants?
How will state renewable portfolio standards affect other resource choices?
What price premium is justified for DSM as a hedging strategy?
Can your fleet survive a major Oil Price increase AND tighter SO2 regulations?
What new generation will make your fleet profitable under most market conditions?

AACG's SRO MODEL

AACG: Power Generation, Model Capabilities Callout Existing simulation approaches focus primarily on chronological dispatch decision-making based on hourly production costs and locational marginal prices. While these models fulfill their intended purpose, they have limited applicability toward higher-level strategic planning issues such as emissions compliance, future technology options, asset retirements and retrofits, and capital planning in an era of unprecedented risks.

SRO is a new AACG framework designed from the ground-up to analyze strategic planning issues while considering the future uncertainty affecting every aspect of the power generation business.