During the 30 years of electricity market deregulation in North America and Europe
power system production simulation plays a critical role as a core technology to address the challenges in power grid operation and planning. This paper addresses the concept
structure
and mathematic models of power system production simulation. Many applications are analyzed
especially under deregulated market environment. This paper also reveals the value of production simulation applications in China and discusses the potential challenges to be encountered. It is proposed to adopt advanced production simulation technology in power system planning and electricity market mechanism design in order to facilitate scientific quantitative approach based analysis and contribute to this round of electricity market reform in China.