Stochastic Modelling Applied to Prediction of Electricity Saving by using Solar Water Heating Systems for Low-Income Families

Abstract

Solar water heating systems for low-income families as Energy Efficiency Action bring energetic benefits for the consumers and the Brazilian Electrical System and also contribute for the reduction of the environmental impacts associated with generation, transmission and distribution of electricity. This paper presents the stochastic modelling for the generation of future scenarios of electricity saving of Energy Efficiency Projects that involves solar water heating systems for low-income families. The model is developed by using the Geometric Brownian Motion Stochastic Process with Mean Reversion (GBM-MR) associated with the Monte Carlo simulation technique. As a result it is possible to obtain the time series and the probability distribution function of the energy saving for each year of the simulation period. Once there is no historical data available for obtaining the standard deviation and the mean reversion speed of the stochastic process, it is presented a sensitivity analysis in order to verify how these parameters influence on the results.