Marginal cost ensures profit of every bid by following the principles of marginal cost pricing. The cost calculations consider a detailed description of physical properties of the plant, the production schedule and the development of the adjacent reservoirs. The bid generation is flexible by allowing the user to adjust for bid volume step and other parameters.
"Marginal cost offers automated generation of bids, which saves time and work for the traders. At the same time the tool assures correct pricing," says product owner at Powel, Viktor Nilsson.
Working with new version
The software solution is in use by hydropower producers in the Nordics. Powel is right now working with a new and upgraded version.
"We are about to extend the solution to include also pump power plants and implement a more advanced way of considering start costs, just to mention some elements," says Nilsson.
Marginal cost is integrated with Powel’s tools for bidding to intraday and regulation markets Powel Intraday Trading and Powel Ancitra and constitutes the link between production planning and trading in a fully automated setup.