The electricity market module (EMM) represents the capacity planning, generation, transmission and distribution, and pricing of electricity subject to delivered prices for coal, petroleum products, and natural gas; O&M costs for existing and new generation equipment; the costs of renewable fuels for generation; the capital costs of power generation investments; and electricity load shapes and demand. The submodules consist of capacity planning, fuel dispatching, finance and pricing, and load and demand-side management (Fig. 4). In addition, nonutility supply and electricity trade are represented in the fuel dispatching and capacity planning submodules. Nonutility generation from cogenerators and other facilities whose primary business is not electricity generation is represented in the demand and fuel supply modules. All other nonutility generation is represented in EMM. The generation of electricity is accounted for in 13 supply regions, whereas consumption is satisfied in the 9 census divisions.
Operating (dispatch) decisions are provided by the cost-minimizing mix of fuel and variable O&M costs, subject to environmental constraints. Capacity expansion is determined by the least cost mix of all
expected costs, including capital, O&M, and fuel, subject to meeting environmental restrictions and expected electricity demand. Construction of generating plants with long lead times is selected with planning horizons up to six periods into the future; the planning horizon can change with respect to the generating technology being considered. Electricity demand is represented by load curves, which vary by region, season, and time of day.
The solution to the submodules of EMM is simultaneous in that, directly or indirectly, the solution for each submodule depends on the solution to every other submodule. A solution sequence through the submodules can be viewed as follows: