Utilities that run coal, natural gas, and oil power plants can control production and predict future revenue. For wind farms, however, business planning presents a challenge. A wind farm’s production changes based on local wind speeds, making forecasts much less reliable.
To generate accurate revenue forecasts and revenue-at-risk projections, Horizon Wind Energy combines production estimates for all wind farms in its portfolio with forecasts of power prices on the futures market. Using MATLAB®, Horizon analysts developed an automated risk-forecasting system that factors in historical data, current prices, and forward-looking estimates from expert analysts.
“Because our team already knew MATLAB, we did not need a programmer. Instead, our structuring and market operations analysts, who already had the necessary experience in mathematics and economics, developed the system directly, which is a much more efficient process,” says Manuel Arancibia, market operations manager at Horizon. “MATLAB enabled these analysts to build a reliable, scalable forecasting and analysis solution from scratch.”