The Impact of Dual-Fuel LNG-LPG Power Generators on Electricity Price and Retailer's Procurement Cost

This paper analyzes the reduction effects on the SMP (System Marginal Price) and system operation costs in the cost-based pool (CBP) wholesale electricity market due to the participation of dual-fuel LNG-LPG power generators. To assess the cost-saving effects of the introduction of dual-fuel power generators, simulations were conducted using the PLEXOS power market analysis program. The dual-fuel power generators were modeled to flexibly choose and apply the cheaper fuel between LNG and LPG. The analysis was carried out based on historical fuel costs and future fuel cost projections, with supply and demand assumptions derived from actual performance or the 10th Basic Plan for Long-term Electricity Supply and Demand. It was found that in all cases set for the market participation of dual-fuel power generators, there were reductions in SMP, system operation costs, and LNG power purchase costs, thereby increasing the benefits for both suppliers and consumers.