USING AN OPTIMIZATION SOFTWARE TO LOWER OVERALL ELECTRIC PRODUCTION COSTS FOR SOUTHERN-COMPANY

The electric utility business has traditionally been very capital-intensive. In the last 10 years, however, fuel costs have escalated at a faster rate than all other cost components. To minimize its fuel cost expenditures, Southern Company installed a comprehensive operational-planning software package to forecast system loads, optimally schedule thermal and hydro units, and estimate future prices of power transactions. The heart of the package is the Wescouger optimization program, designed by the Advanced System Technology division of ABB Power Systems, Inc. By using state-of-the-art dynamic programming and branch-and-bound techniques, Wescouger has helped Southern Company save over $140 million in fuel costs over the past seven years. Today, this optimization software is one of the key scheduling tools used at the control center in Birmingham to fulfill the pool's most important responsibility-to deliver electricity to customers in the most reliable and least costly manner.