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Electric market example

Colección

As a very interesting practical example of dual problems, in this lesson we deal with the case of an electric market. We state the problem as a primal problem first, and later as its dual problem. The primal is a dictatorial procedure, in which the market operator, ask the private information to the producers, and decides the optimal production for the system imposing the producers the quota of production. In the dual problem, the operator just control the prices and the producers decide the amount of production without the need of informing the operator about private information. An iterative process of change of prices leads to satisfaction of the demand. The surprising result is that both results are identical. An iterative method is used to solve the dual problem, which is based on adjusting the prices until convergence.

Autores Enrique Castillo
Fecha 20/09/2019 Idioma Ingles

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Contenido

Electric Market

In this problem we deal with an electric market. We state the problem as a primal, which is a dictatorial procedure handled by the operator, and its dual problem, in which the operator just control the prices and the producers decide the amount of production. An iterative process of change of prices leads to satisfaction of the demand. The interesting and surprising result is that both results are identical.

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