Difference between COST and VAROM

[mresende]

I have a TIMES model in which a process has two attributes: COST and VAROM. In the .lst file, I can see that TIMES is treating both attributes equally, that is, it sums both costs and multiply this sum by the process activity. Reading the manual, I understood that the difference between VAROM and COST is that VAROM = VARCOST = VAR_XXX * XXX_COST, where XXX is any variable that represents an activity in period t, like ACT or FLO. As COST = ACTCOST, if the variable that represents the activity is VAR (which is indeed our case), then VARCOST = ACTCOST, and so, VAROM = COST. 


Can you confirm that this interpretation is correct? Moreover, in this case, it is OK to remove the column COST of this process and sum its values in the VAROM column?

Thank you,
 Marcelo Resende

[pdas]

VAROM and COST are two different attributes having different meaning. VAROM or ACT_COST is the variable operating cost of a process defined as cost/unit activity ($/Mwh) (excluding fuel cost), whereas COST is essentially IRE_PRICE (check attribute master in FE). IRE_PRICE is used to define resource extraction (mining) cost, import/ export cost of IRE processes. You can declare IRE_PRICE to define electricity import price ($/Mwh) of a bi-directional electricity trade process which has its own VAROM cost.

[mresende]

OK, but is there any mathematical difference between both attributes, in the formulation of the equations? That is, if I say a process has a VAROM of 100, will the equations built by TIMES be different than those in the case in which I declare COST=100?

Thanks

[Antti-L]

The main "mathematical" difference is that IRE_PRICE works only for exogenous IRE processes.  It is ignored for any other processes. ACT_COST works for all processes.

Another "mathematical" difference is that IRE_PRICE can be differentiated by commodity and timeslice, while ACT_COST cannot: it can only be specified on the activity at ANNUAL level. For defining commodity and/or timeslice-specific costs, use FLO_COST / FLO_DELIV instead of ACT_COST.

Thus, for exogenous IRE processes IRE_PRICE is equivalent to FLO_COST (and in your example apparently also to ACT_COST).

[mresende]

I understood that COST can be differentiated by commodity and timeslice, which is not true for VAROM. But now I am puzzled by another issue. You said that COST is valid only for IRE processes, so COST=IRE_PRICE. However, my interpretation of the manual was that COST was a broader concept and might be also used for non-IRE processes. Summing up, my doubt is whether COST may be used only for IRE processes.

[Antti-L]

Which manual are you talking about?  

TIMES definitely does not have any attribute named "COST", only VEDA-FE has.
And, looking at the Attributes Master in VEDA-FE, I can see "COST" mentioned only as an alias for IRE_PRICE.

In TIMES, IRE_PRICE can only be used for exogenous IRE processes (those that exchange a commodity with an external region).