Market Trends That Will Drive the Next Evolution of Operational Load Forecasting Models

Grid operators schedule and dispatch generation resources to meet demand in as cost-effective manner as possible. In a perfect world, the least costly solution would be to schedule and dispatch generation where the supply stack of generation exactly crosses the demand curve. With perfect foresight, generation would exactly offset demand. Because grid operators do not have perfect foresight of demand and there is always the possibility that a failure will occur somewhere within the electric grid, operators schedule an excess level of generation in the form of spinning reserves. This type of risk-adverse scheduling is common practice throughout the industry. In fact, most grid operators are held to a regulatory-prescribed minimum operating reserve margin. These operating reserve margins are accepted as a reasonably societal cost for avoiding generation shortages.

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