Uncertainty Management, Stochastics, and Hedging Techniques for Resource Planning

Long-term energy system planning and decision making requires navigating uncertainty in the evolution of many key drivers such as demand, fuel prices, policy, and technology costs. Uncertainty management techniques, including scenario generation, scenario reduction, and stochastic planning methods, complement existing practices and can help planners manage the uncertainty. This report presents a long-range resource planning case study for a representative power system to demonstrate the insights that can be obtained using these uncertainty management methods. Underlying concepts, comparisons and descriptions of planning techniques, hedging strategies, computational techniques, and the resulting expansion plan for the case study are shared.

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