KyPlant - Power Plant Optimization Software
KyPlant supports traders and plant owners in power markets. The power plant optimization software determines the value of power plants by quickly calculating the optimal dispatch. It also supports trading decisions and reports exposures. The real options-based model combines actual plant and contract characteristics with realistic price simulations. It can be applied to real physical power plants, but also to virtual power plants, spark and dark spread options, and power options.
1. Spot market: how to dispatch?
For day ahead and intraday markets, the power plant optimization model tells you what is optimal to do: produce or don’t produce? When prices change due to unforeseen circumstances, it could be optimal to change the dispatch decision on the intraday market.
2. Forward market: keep the risk or lock in profits?
KyPlant shows which forward transactions are optimal to hedge risks and lock in profits. The user can choose between intrinsic hedging and delta hedging,
3. Power Market: What is a fair price?
The power plant valuation model calculates the fair value of a power station. The model shows which part of the value is intrinsic and which part is extrinsic. To capture the extrinsic value, a more active trading strategy is required.
Extrinsic values are derived from an intuitive and realistic Monte Carlo simulation model. A combination of forward and spot trading strategies is applied to the simulated price scenarios, using dynamic programming and least-squares Monte Carlo. This type of valuation provides a fair assessment of the future value. Backtesting of the model is another feature: it shows how much money you would have made in the past, following a specific trading strategy.