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The reliable estimation of forecast uncertainties is crucial for risk-sensitive optimal decision making. In this paper, we propose implicit generative ensemble post-processing, a novel framework for multivariate probabilistic electricity…

Applications · Statistics 2020-11-16 Tim Janke , Florian Steinke

This paper considers the optimal control of time varying continuous time Markov chains whose transition rates are themselves Markov processes. In one set of problems the solution of an ordinary differential equation is shown to determine…

Systems and Control · Computer Science 2015-09-02 Manish Gupta

A new branch based on Markov processes is developing in the recent literature of financial time series modeling. In this paper, an Indexed Markov Chain has been used to model high frequency price returns of quoted firms. The peculiarity of…

Statistical Finance · Quantitative Finance 2018-02-06 Guglielmo D'Amico , Ada Lika , Filippo Petroni

The start up costs in many kinds of generators lead to complex cost structures, which in turn yield severe market loopholes in the locational marginal price (LMP) scheme. Convex hull pricing (a.k.a. extended LMP) is proposed to improve the…

Optimization and Control · Mathematics 2020-02-19 Jian Sun , Chenye Wu

Markov switching models are a popular family of models that introduces time-variation in the parameters in the form of their state- or regime-specific values. Importantly, this time-variation is governed by a discrete-valued latent…

Econometrics · Economics 2023-11-13 Yong Song , Tomasz Woźniak

Markov Population Models are a widespread formalism used to model the dynamics of complex systems, with applications in Systems Biology and many other fields. The associated Markov stochastic process in continuous time is often analyzed by…

Machine Learning · Computer Science 2021-06-25 Francesca Cairoli , Ginevra Carbone , Luca Bortolussi

Minimizing the peak power consumption and matching demand to supply, under fixed threshold polices, are two key requirements for the success of the future electricity market. In this work, we consider dynamic pricing methods to minimize the…

Optimization and Control · Mathematics 2016-10-26 Zaid Almahmoud , Jacob Crandall , Khaled Elbassioni , Trung Thanh Nguyen , Mardavij Roozbehani

We propose a vector linear programming formulation for a non-stationary, finite-horizon Markov decision process with vector-valued rewards. Pareto efficient policies are shown to correspond to efficient solutions of the linear program, and…

Optimization and Control · Mathematics 2025-06-02 Anas Mifrani , Dominikus Noll

Renewable energy power is influenced by the atmospheric system, which exhibits nonlinear and time-varying features. To address this, a dynamic temporal correlation modeling framework is proposed for renewable energy scenario generation. A…

Machine Learning · Computer Science 2025-01-27 Xiaochong Dong , Yilin Liu , Xuemin Zhang , Shengwei Mei

Polynomial processes have the property that expectations of polynomial functions (of degree $n$, say) of the future state of the process conditional on the current state are given by polynomials (of degree $\leq n$) of the current state.…

Computational Finance · Quantitative Finance 2018-04-27 Damir Filipovic , Martin Larsson , Tony Ware

We consider an energy storage problem involving a wind farm with a forecasted power output, a stochastic load, an energy storage device, and a connection to the larger power grid with stochastic prices. Electricity prices and wind power…

Optimization and Control · Mathematics 2020-02-04 Joseph L. Durante , Juliana Nascimento , Warren B. Powell

Power grid operations increasingly interact with environmental systems and human systems such as transportation, agriculture, the economy, and financial markets. Our objective is to discuss the modelling gaps and opportunities to advance…

Systems and Control · Electrical Eng. & Systems 2021-10-19 K. Oikonomou , J. Kern , B. Tarroja , N. Voisin

The increasing interest in demand-side management (DSM) as part of the energy cost optimization calls for effective methods to determine representative electricity prices for energy optimization and scheduling investigations. We propose a…

Applications · Statistics 2026-01-15 Chrysanthi Papadimitriou , Jan C. Schulze , Alexander Mitsos

This paper studies the procurement and pricing of inertial response using a frequency-constrained unit commitment formulation, which co-optimizes the provision of energy and inertia services while accounting for their complementary…

Optimization and Control · Mathematics 2020-05-25 Matthieu Paturet , Uros Markovic , Stefanos Delikaraoglou , Evangelos Vrettos , Petros Aristidou , Garbiela Hug

The energy market relies on forecasting capabilities of both demand and power generation that need to be kept in dynamic balance. Today, when it comes to renewable energy generation, such decisions are increasingly made in a liberalized…

Machine Learning · Computer Science 2022-03-15 Odin Foldvik Eikeland , Finn Dag Hovem , Tom Eirik Olsen , Matteo Chiesa , Filippo Maria Bianchi

We propose and study a simple stochastic model for the dynamics of a limit order book, in which arrivals of market order, limit orders and order cancellations are described in terms of a Markovian queueing system. Through its analytical…

Trading and Market Microstructure · Quantitative Finance 2015-03-19 Rama Cont , Adrien De Larrard

Cross-layer scheduling is a promising way to improve Quality of Service (QoS) given a power constraint. In this paper, we investigate the system with random data arrival and adaptive transmission. Probabilistic scheduling strategies aware…

Information Theory · Computer Science 2016-11-18 Xiang Chen , Wei Chen

We propose a scenario-oriented approach for energy-reserve joint procurement and pricing for electricity market. In this model, without the empirical reserve requirements, reserve is procured according to all possible contingencies and…

Systems and Control · Electrical Eng. & Systems 2020-11-23 Jiantao Shi , Ye Guo , Lang Tong , Wenchuan Wu , Hongbin Sun

In the information-based approach to asset pricing the market filtration is modelled explicitly as a superposition of signals concerning relevant market factors and independent noise. The rate at which the signal is revealed to the market…

Pricing of Securities · Quantitative Finance 2010-09-21 Dorje C. Brody , Yan Tai Law

We propose a new methodology for pricing options on flow forwards by applying infinite-dimensional neural networks. We recast the pricing problem as an optimization problem in a Hilbert space of real-valued function on the positive real…

Pricing of Securities · Quantitative Finance 2022-02-24 Fred Espen Benth , Nils Detering , Luca Galimberti