Optimal Medium-Term Electricity Procurement for Cement Producers

Abstract

In the current economic and energy situation, it is imperative for major electricity consumers to meticulously determine their electricity procurement. This is the case for cement producers. This work intends to determine the most efficient approach to electricity acquisition, considering their involvement in the electricity pool, power-purchase agreements, and the potential installation of a photovoltaic self-production unit and a battery storage system. To achieve this, we model the electricity consumption flexibility of cement producers, accounting for all production processes associated with cement and clinker manufacturing. This results in the formulation of a mid-term decision-making problem under uncertainty, which is addressed through the application of a two-stage risk-averse stochastic programming formulation. In order to reduce the computational size of the resulting optimization problem, the planning horizon is characterized by a set of representative periods obtained through a procedure based on chronological time-period clustering. To analyze the practical viability of the proposed approach, a realistic case study is solved featuring an existing cement producer, real-world energy pool prices, and data pertaining to renewable energy production. The findings derived from this case study highlight the viability of installing a photovoltaic self-production unit as a strategic measure to reduce the expected procurement expenses for the cement producer. Moreover, the photovoltaic self-production unit proves instrumental in mitigating the vulnerability to elevated procurement costs. It has been also observed that an imprecise modeling of the technical characteristics within the cement manufacturing processes can lead to a substantial underestimation of procurement costs.

Keywords

• Large electricity consumer
• power purchase agreements
• cement plant
• self-generation facility
• stochastic programming