ABSTRACT
This chapter considers the electric energy system is managed by a central operator with full information on the technical and economic data of the generating units, the demands, and the network. It shows that the system is operated within a market environment in which producers compete with each other to supply power to the consumers, whose demand may exhibit an elastic behavior. The chapter describes a short-term operation perspective with a time framework ranging from several minutes to one week. The economic dispatch problem consists in allocating the total demand among generating units so that the production cost is minimized. In addition to the continuous decisions on how to allocate the demand among generating units, a decision that involves calculating the MW outputs of all units, the economics of electricity generation also requires the calculation of an optimum time schedule for the start-up and shutdown of the generating units.
