The inter-temporal optimization of the operation of the nuclear fuel reservoir in a liberalized electricity market dominated by the nuclear generation

Pascal Gourdel (1, 2) , Maria Lykidi (1, 2)

1 CES - Centre d'économie de la Sorbonne
2 PSE - Paris School of Economics

We look at the optimal inter-temporal management of the fuel reservoir of nuclear units in a liberalized electricity market. We use the assumption that nuclear fuel works as a “reservoir” of energy due to the periodical shutdown of nuclear units to reload their fuel. In the medium-term, how a producer sets the nuclear fuel of the reservoir to respond to the variations of seasonal demand in order to maximize its production value on a multi-annual basis? The dynamic nature of the nuclear fuel reservoir highlighted the discontinuity of the price which complicates the resolution of the optimal inter-temporal production problem and even leads to a lack of solutions. Theoretically, at the optimum, nuclear is used to serve baseload and thermal follows demand's variations. Numerically, both nuclear and thermal units operate in load-following mode. Solutions characterized by a constant nuclear production do not exist which shows that the significant share of nuclear in the energy mix does not permit to produce at a constant rate unless further investments in thermal capacity are done. Inter-temporal optimization shows the role of nuclear for ensuring the equilibrium between supply and demand.

Mots clés: merit order price; discontinuity problem; electricity production; nuclear fuel reservoir; inter-temporal optimization; thermal production

Domaines: Economies et finances

Pascal Gourdel, Maria Lykidi. The inter-temporal optimization of the operation of the nuclear fuel reservoir in a liberalized electricity market dominated by the nuclear generation. 2014. ⟨halshs-01053476⟩