Challenges In Forecasting Electric Load In Deregulated Markets

CHALLENGES IN FORECASTING ELECTRIC LOAD IN DEREGULATED MARKETS By Ernie Podraza The biggest challenge in forecasting electric load is predicting weather … generally, there is less error when forecasts are prepared at the aggregate level … since electricity cannot be stored, the cost of forecast error in electricity business is very high. Reliant Energy provides energy products and services to approximately 1.9 million customers in the deregulated markets known as ERCOT (Electric Reliability Council of Texas) and PJM Interconnection (Pennsylvania, New Jersey, and Maryland). The customers in the ERCOT market range from residences and small businesses to large commercial,governmental, industrial, and institutional customers in Texas; PJM Interconnection customers are commercial, governmental, and industrial. Reliant Energy is one of the largest independent power producers in the nation with approximately 16,000 megawatts (MW) of power generation capacity from continuing operations or under contract across the United States. It ranked 220 on the 2006 Fortune 500 List. ERCOT is the organization entrusted to keep electric power flowing to approximately 20 million Texas ...