Study Of Energy Procurement And Marketing Decision In Competitive Retail Market

In2002, competition was introduced into electricity wholesale market via the segregation of grid and power plant, which drew back the prelude of electricity reform in China. To aim at optimal allocation of resources and lower the electricity tariff, it is imperative to open the retail market.In retail market, retailers need to meet instantaneous and variable load what they must purchase from bilateral and pool markets, and also have to consider the uncertainty and volatility of the pool market price and changes of market share caused by different selling prices. Therefore, as an independent economic entity, a retailer makes decision of both energy procurement approach and marketing strategy of sales contracts and their optimal tariff in order to maximize profit. In this paper, the energy procurement and marketing decision problem is studied for retailers in competitive environment.Firstly, from the viewpoint of retailers, market share function is used to simulate consumer choice of retailer and electricity contract in competitive market. Market share is modeled using AHP-Logit method considering public praise, contract structure and other factors. The influence of selling prices on market share is also studied in this paper.Then a marketing approach of fixed price and up-low limited price is studied. Considering the characteristic of bilateral and pool market, a profit mean-VaR optimization model is established to solve the energy procurement allocation and tariff setting problem. The result indicates that diversified contract category can increase market share, reduce market risk and ca n also promote competition in generation market indirectly.Finally, a profit mean-VaR optimization model considering influence of interruptible load is proposed in this paper. Considering the risk reduction efficiency of interruptible load, IL will facilitate retailer to adjust its marketing strategy in order to encourage more consumers to choose fixed price. IL can increase the profit, reduce the market risk, and can also make a retailer more competitive through strategy adjustment. This article provides retailer a practical and workable decision model and makes a great contribute to the study of retail market.