The electricity supply market is rapidly changing from a monopolistic to a competitive environment. Being able to operate their system of reservoirs and generating facilities to get maximum benefits out of existing assets and resources is important to the British Columbia Hydro Authority (B.C. Hydro). A decision support system has been developed to help B.C. Hydro operate their system in an optimal way. The system is operational and is one of the tools that are currently used by the B.C. Hydro system operations engineers to determine optimal schedules that meet the hourly domestic load and also maximize the value B.C. Hydro obtains from spot transactions in the Western U.S. and Alberta electricity markets.

This dissertation describes the development and implementation of the decision support system in production mode. The decision support system consists of six components:​ the input data preparation routines, the graphical user interface (GUI), the communication protocols, the hydraulic simulation model, the optimization model, and the results display software.

A major part of this work involved the development and implementation of a practical and detailed large-scale optimization model that determines the optimal tradeoff between the long-term value of water and the returns from spot trading transactions in real-time operations. The postmortem-testing phase showed that the gains in value from using the model accounted for 0.25% to 1.0% o f the revenues obtained. The financial returns from using the decision support system greatly outweigh the costs of building it. Other benefits are the savings in the time needed to prepare the generation and trading schedules. The system operations engineers now can use the time saved to focus on other important aspects of their job. The operators are currently experimenting with the system in production mode, and are gradually gaining confidence that the advice it provides is accurate, reliable and sensible. The main lesson learned from developing and implementing the system was that there is no alternative to working very closely with the intended end-users of the system, and with the people who have deep knowledge, experience and understanding of how the system is and should be operated.