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Genetic programming prediction of the natural gas consumption in a steel plant

Miha Kovačič and Božidar Šarler

Energy, 2014, vol. 66, issue C, 273-284

Abstract: The Energy Agency of the Republic of Slovenia regulates and determines the operations of the natural-gas market, charges for related gas imbalances, decides on suppliers and controls penalty provisions relating to breaches of stipulated provisions. Each supplier regulates and determines the charges for the differences between the ordered (predicted) and the actually supplied quantities. Štore Steel Company is one of the major spring-steel producers in Europe. Its natural gas consumption represents approximately 1.1% of Slovenia's national natural gas consumption. The company is contractually bound to a supplier which exacts penalties according to the differences mentioned above. A successful approach to gas consumption prediction is elaborated in this paper, with the aim of minimizing associated costs. In the attempt to model and predict the gas consumption and, accordingly, to minimize ordered and supplied gas quantity error, we used linear regression and the genetic programming approach. The genetic programming model performs approximately two times more favorably. The developed gas consumption model has been used in practice since April 2005. The results show good agreement between the model-based ordered quantities and the actually supplied quantities, with savings amounting to approximately 100,000 EUR per year.

Keywords: Natural gas consumption; Steel plant; Modeling; Genetic programming (search for similar items in EconPapers)
Date: 2014
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Handle: RePEc:eee:energy:v:66:y:2014:i:c:p:273-284