The annual demand of electricity in small town is estimated at 120MWH annually received primarily its Co-op
Question:
The annual demand of electricity in small town is estimated at 120MWH annually received primarily its Co-op but can be supplemented from the grid network at $160/ MWH in case of shortages. The Co-op uses renewable energy sources (windmill, solar, and hydroelectric) all of which are impacted by weather conditions, and hence is subject to uncertainty compared to the reliable grid network. The Co-op can purchase a maximum of 15 MWH from the grid network at $150/MWH. It can also sell any surplus electricity back to the grid network at $140/MWH. Past history shows that the Co-op’s renewable energy, E, can be either be 90 with probability .3 or 100 with probability .7. The Co-op collects directly from the city residents through monthly charges. Develop a model for the situation and solve it using TORA, then interpret the solution.
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