Description
fuelCost = gasPricePerFuelUnit*heatRate; sparkSpread = powerPrice-fuelCost-variableCost.
A generation or storage spread compares revenue with specified fuel, carbon, purchase or hedge costs. It is a local margin on a common output-energy basis, rather than complete profit or proof a dispatch or trade is feasible.
fuelCost = gasPricePerFuelUnit*heatRate; sparkSpread = powerPrice-fuelCost-variableCost.
When to use this tool
Use Spark Spread Heat Rate One Unit when checking one declared generation, storage or hedge-margin contribution.
How to use the tool and how it works
- Enter powerPrice, gasPricePerFuelUnit, heatRate, variableCost. Use the units and conventions below.
- Run the tool. Correct any format, range, or cross-field input error before interpreting the output.
- Read fuelCost, sparkSpread. Use the output convention below.
Require nonnegative heatRate. fuelCost = gasPricePerFuelUnit*heatRate; sparkSpread = powerPrice-fuelCost-variableCost. heatRate is fuel units per electrical output unit; all returned costs use the power-price unit.1
| Input field | Meaning and units | Accepted input |
|---|---|---|
| powerPrice | Power Price | Required. Finite number. |
| gasPricePerFuelUnit | Gas Price Per Fuel Unit | Required. Finite number. |
| heatRate | Heat Rate | Required. Finite number; minimum 0. |
| variableCost | Variable Cost | Required. Finite number. |
| Output field | Interpretation | Returned shape |
|---|---|---|
| fuelCost | Fuel Cost | Required. Finite number. |
| sparkSpread | Spark Spread | Required. Finite number. |
{
"input": {
"powerPrice": 100,
"gasPricePerFuelUnit": 10,
"heatRate": 7,
"variableCost": 5
},
"output": {
"fuelCost": 70,
"sparkSpread": 25
}
}Limitations and assumptions
- A positive local spread is not full profit or dispatch feasibility. Startup costs, fixed costs, emissions charges and plant limits require separate treatment.
- Inputs must satisfy both the field types and the cross-field conditions above. Invalid input causes an error; a successful false flag or documented placeholder is a different result.
- Numeric calculations use binary floating point unless exact decimal-integer arithmetic is explicitly stated. No hidden measurement tolerance or decimal rounding is added; nonfinite or out-of-contract results are rejected. Numeric signed-zero results are exported as zero.
Alternative or Complementary methods
Use complete operating costs, technical constraints and settlement terms to assess a real dispatch, hedge or investment.
References
Similar or alternative tools
- Dark Spread Emission Cost Term
fuelCost = coalPrice*fuelUnitsPerMwh; carbonCost = emissionsPerMwh*carbonPrice; cleanDarkSpread = powerPrice-fuelCost-carbonCost-variableCost.
- Energy Hedge Volume Shape Mismatch
unhedgedMwh = loadMwh-hedgedMwh; settlementCost = hedgedMwh*fixedPrice+unhedgedMwh*spotPrice; fullyHedgedCostGap = unhedgedMwh*(spotPrice-fixedPrice).