Historically electric utilities were seen as potential users of probabilistic models both in their operations and in planning. Operations issues included unit commitment and dispatch, and medium- to long-term scheduling of hydroelectric and other energy-limited resources. Planning issues centered around centralized capacity expansion.

The electricity business is now undergoing a wrenching transformation, from tightly regulated or government-owned monopolies to competitive wholesale and retail sectors. The deregulatory movement has criss-crossed the world, including nations as diverse as Chile, Australia, Norway, the United Kingdom, and now the United States (as well as many others too numerous to mention). Industry restructuring in North America has proceeded in fits and starts, much more advanced in some regions than others.

This talk will describe the functions of deregulated electricity businesses and opportunites for stochastic and probabilistic modeling:

- Wholesale sector
- Unit scheduling against price curves
- Choice of production among partially substitutable products (energy and ancillary services)
- Choice of markets (forward, day-ahead, real-time)
- Retail sector
- Procurement choices
- Risk management associated with full-requirements load (price risks, volumetric risks, shaping risks)
- Cost estimation and pricing
- Load forecasting and hedging
- Asset purchase
- Evaluating generation purchases
- Evaluating load (specific customers or "last resort")

Disclaimer: PG&E Energy Services is not the same company as Pacific Gas and Electric Company, the utility. PG&E Energy Services is not regulated by the California Public Utilities Commission; and you do not have to buy PG&E Energy Services' products in order to continue to receive quality regulated services from Pacific Gas and Electric Company, the utility.

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