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Modeling Electricity Markets with Optimization: Why It’s Important (and Fun)

Ben Hobbs


Electric power: done wrong, it drags the economy and environment down; done right, it could help to create a more efficient, brighter, and cleaner future. Better policy, planning, and operations models–both simple analytical, and complex computational ones–are essential if we’re going to do it right. Better modeling is also fun, as the math of electricity models is inherently interesting and revealing –models often show flaws in our intuition. Used intelligently, models can point us towards better regulations, investments, and operating policies. I highlight two applications. Simple models are important for timely recommendations and insights for policy and market design; this is illustrated by an application to implementation of California’s AB32 CO2 limits. Complex models are more relevant to investment and operations; a critical need is better transmission infrastructure planning under gross uncertainties including carbon policies, growth in demand and fuel prices, and location of renewable development. All models are wrong, but better models can help us avoid terrible investment and policy mistakes.


Benjamin F. Hobbs earned a Ph.D. (Environmental Systems Engineering) in 1983 from Cornell University. He holds Theodore M. and Kay W. Schad Chair of Environmental Management at the Johns Hopkins University, where he has been in the Department of Geography & Environmental Engineering since 1995. He also holds a joint appointment in the Department of Applied Mathematics & Statistics, and is founding director of the JHU Environment, Energy, Sustainability & Health Institute. Previously, he was at Brookhaven and Oak Ridge National Laboratories and a member of the Systems Engineering and Civil Engineering faculty at Case Western Reserve University.

His research and teaching concerns the application of systems analysis and economics to electric utility regulation, planning, and operations, as well as environmental and water resources systems. Dr. Hobbs has had visiting appointments at the Helsinki University of Technology, University of Washington, Netherlands Energy Research Center, and Cambridge University. He chairs the Market Surveillance Committee of the California Independent System Operator, and is a member of the Public Interest Committee of the Gas Technology Institute. Dr. Hobbs is a Fellow of the IEEE and INFORMS.

Ben Hobbs Headshot
Ben Hobbs
Johns Hopkins University
EEB 125
13 Nov 2013, 4:30pm until 5:30pm