What is the Economics of the Power System?
The economics of power generation is the process of calculating the cost of producing electrical energy per unit (i.e. KWH). Customers utilize electric power when it is supplied at reasonable rates. So, power engineers have to find cost-effective methods to provide electricity to customers at affordable prices.
While designing or constructing a power station, engineers will take care of the overall economy so that the per-unit cost of production is as low as possible. So that the electric supply company can sell electrical energy at a profit and ensure reliable service. The main aim of a power engineer is to minimize production costs without sacrificing quality. Power system aims to deliver power to a large number of consumers.
As we know, power demand is not constant. It varies with the usage of different consumers. Due to the variation in usage of consumers, the load on the power system is never constant. It varies from time to time. This variation of load on the power system is called as the variable load on the station.
So, as the demand changes then power supplied by the power system also changes. The power demanded by the consumers is supplied by the power system through transmission and distribution lines.
Economics of Power Generation
Here in this article, we will discuss the economics of power generation, terminologies used in the economics of power generation, isolated and integrated operations, and their differences , merits of integrated operation, classification of cost of electrical energy, tariff and its types and power generation charges briefly.
Table of Content
- What is the Economics of the Power System?
- Terminologies
Isolated and Integrated Operation- Differences Between Isolated and Integrated Operation
- Advantages
- Cost of Electrical Energy
- Tariff – Its Types
- Solved Example
Conclusion
Frequently Asked Questions