Search results for: Power factor correction.

Authors: O. Onal, O. Turan

Abstract:

In this paper, some performance parameters of a selected turbofan engine (JT9D) are analyzed. The engine is a high bypass turbofan engine which powers a wide-body aircraft and it produces 206 kN thrust force (thrust/weight ratio is 5.4). The objective parameters for the engine include calculation of power, specific fuel consumption, specific thrust, engine propulsive, thermal and overall efficiencies according to the various definitions given in the literature. Furthermore, in the case study, wasted energy from the exhaust is calculated at the maximum power setting (i.e. take off phase) for the engine.

Keywords: Turbofan, power, efficiency, trust.

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Authors: P. Nammalvar, P. Meganathan, A. Balamuguran

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Among various active filters, shunt active filter is a viable solution for reactive power and harmonics compensation. In this paper, the SRF plan is used to generate current reference for compensation and conventional PI controllers were used as the controller to compensate the reactive power. The design of the closed loop controllers is reserved simple by modeling them as first order systems. Computationally uncomplicated and efficient SVM system is used in the present work for better utilization of dc bus voltage. The rating of shunt active filter has been finalized based on the reactive power demand of the selected reactive load. The proposed control and SVM technique are validated by simulating in MATLAB software.

Keywords: Shunt Active Filter, Space vector pulse width modulation, Voltage Source Converter, Reactive Power, Synchronous Reference Frame, Point of common coupling.

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Authors: B. Lorestani, M. Cheraghi, N. Yousefi

Abstract:

A research project dealing with the phytoremediation of a soil polluted by some heavy metals is currently running. The case study is represented by a mining area in Hamedan province in the central west part of Iran. The potential of phytoextraction and phytostabilization of plants was evaluated considering the concentration of heavy metals in the plant tissues and also the bioconcentration factor (BCF) and the translocation factor (TF). Also the several established criteria were applied to define hyperaccumulator plants in the studied area. Results showed that none of the collected plant species were suitable for phytoextraction of Cu, Zn, Fe and Mn, but among the plants, Euphorbia macroclada was the most efficient in phytostabilization of Cu and Fe, while, Ziziphora clinopodioides, Cousinia sp. and Chenopodium botrys were the most suitable for phytostabilization of Zn and Chondrila juncea and Stipa barbata had the potential for phytostabilization of Mn. Using the most common criterion, Euphorbia macroclada and Verbascum speciosum were Fe hyperaccumulator plants. Present study showed that native plant species growing on contaminated sites may have the potential for phytoremediation.

Keywords: Bioconcentration factor, Heavy metals, Hyperaccumulator, Phytoremediation, Translocation factor

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Authors: M. Bassoui, M. Ferfra, M. Chraygane, M. Ould Ahmedou, N. Elghazal, A. Belhaiba

Abstract:

Currently, the High voltage power supply for microwave generators with one magnetron uses a single-phase transformer with magnetic shunt. To contribute in the development of technological innovation in industry of manufacturing of power supplies of magnetrons for microwaves, ovens for domestic or industrial use, this original work treats the optimization of a new three-phase high voltage power supply for industrial microwaves generators with N magnetrons by phase (Treated case N=1), from its modeling with Matlab-Simulink. The design of this power supply uses three π quadruple models equivalents of new three-phase transformer with magnetic shunt of each phase. Every one supplies at its output a voltage doubler cell composed of a capacitor and a diode that in its output supplies only one magnetron.  In this work we will define a strategy that aims to reduce the volume of the transformer and the weight and cost of the entire system of the high voltage power supply, while respecting the conditions recommended by the manufacturer, concerning the current flowing in each magnetron: (Imax <1.2 A, IAv ≈ 300 mA).

 

Keywords: Optimization, Three-phase transformer, Modeling, power supply, magnetrons, Matlab Simulink, High Voltage

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Authors: R. Resmi, M. R. Baiju

Abstract:

The thermal damping of a dynamic vibrating micromirror is an important factor affecting the design of MEMS based actuator systems. In the development process of new micromirror systems, assessing the extent of energy loss due to thermal damping accurately and predicting the performance of the system is very essential. In this paper, the depth of the thermal penetration layer at different eigenfrequencies and the temperature variation distributions surrounding a vibrating micromirror is analyzed. The thermal penetration depth corresponds to the thermal boundary layer in which energy is lost which is a measure of the thermal damping is found out. The energy is mainly dissipated in the thermal boundary layer and thickness of the layer is an important parameter. The detailed thermoacoustics is used to model the air domain surrounding the micromirror. The thickness of the boundary layer, temperature variations and thermal power dissipation are analyzed for a Si based torsional mode micromirror. It is found that thermal penetration depth decreases with eigenfrequency and hence operating the micromirror at higher frequencies is essential for reducing thermal damping. The temperature variations and thermal power dissipations at different eigenfrequencies are also analyzed. Both frequency-response and eigenfrequency analyses are done using COMSOL Multiphysics software.

Keywords: Eigen frequency analysis, micromirrors, thermal damping, thermoacoustic interactions.

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Authors: Boo-Sung Koh, Seung-Eock Kim

Abstract:

In this paper, a direct design using a nonlinear inelastic analysis is suggested. Also, this paper compares the load carrying capacity obtained by a nonlinear inelastic analysis with experiment results to verify the accuracy of the results. The allowable stress design results of a railroad through a plate girder bridge and the safety factor of the nonlinear inelastic analysis were compared to examine the safety performance. As a result, the load safety factor for the nonlinear inelastic analysis was twice as high as the required safety factor under the allowable stress design standard specified in the civil engineering structure design standards for urban magnetic levitation railways, which further verified the advantages of the proposed direct design method.

Keywords: Direct design, nonlinear inelastic analysis, residual stress, initial geometric imperfection.

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Authors: Mahmood Reza Shakarami, Reza Sedaghati

Abstract:

Electricity market activities and a growing demand for electricity have led to heavily stressed power systems. This requires operation of the networks closer to their stability limits. Power system operation is affected by stability related problems, leading to unpredictable system behavior. Voltage stability refers to the ability of a power system to sustain appropriate voltage levels through large and small disturbances. Steady-state voltage stability is concerned with limits on the existence of steady-state operating points for the network. FACTS devices can be utilized to increase the transmission capacity, the stability margin and dynamic behavior or serve to ensure improved power quality. Their main capabilities are reactive power compensation, voltage control and power flow control. Among the FACTS controllers, Static Var Compensator (SVC) provides fast acting dynamic reactive compensation for voltage support during contingency events. In this paper, voltage stability assessment with appropriate representations of tap-changer transformers and SVC is investigated. Integrating both of these devices is the main topic of this paper. Effect of the presence of tap-changing transformers on static VAR compensator controller parameters and ratings necessary to stabilize load voltages at certain values are highlighted. The interrelation between transformer off nominal tap ratios and the SVC controller gains and droop slopes and the SVC rating are found. P-V curves are constructed to calculate loadability margins.

Keywords: SVC, voltage stability, P-V curve, reactive power, tap changing transformer.

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Authors: H. Bevrani, A. G. Tikdari, T. Hiyama

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Optimal load shedding (LS) design as an emergency plan is one of the main control challenges posed by emerging new uncertainties and numerous distributed generators including renewable energy sources in a modern power system. This paper presents an overview of the key issues and new challenges on optimal LS synthesis concerning the integration of wind turbine units into the power systems. Following a brief survey on the existing LS methods, the impact of power fluctuation produced by wind powers on system frequency and voltage performance is presented. The most LS schemas proposed so far used voltage or frequency parameter via under-frequency or under-voltage LS schemes. Here, the necessity of considering both voltage and frequency indices to achieve a more effective and comprehensive LS strategy is emphasized. Then it is clarified that this problem will be more dominated in the presence of wind turbines.

Keywords: Load shedding, emergency control, voltage, frequency, wind turbine.

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Authors: Susmita Sahoo, Madhumanti Datta, Rajib Kar

Abstract:

The resistive-inductive-capacitive behavior of long interconnects which are driven by CMOS gates are presented in this paper. The analysis is based on the ¤Ç-model of a RLC load and is developed for submicron devices. Accurate and analytical expressions for the output load voltage, the propagation delay and the short circuit power dissipation have been proposed after solving a system of differential equations which accurately describe the behavior of the circuit. The effect of coupling capacitance between input and output and the short circuit current on these performance parameters are also incorporated in the proposed model. The estimated proposed delay and short circuit power dissipation are in very good agreement with the SPICE simulation with average relative error less than 6%.

Keywords: Delay, Inverter, Short Circuit Power, ¤Ç-Model, RLCInterconnect, VLSI

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Authors: Muhammad Naeem, Abdus Salam, Muhammad Asghar Bashir, Abir Ishtiaq, Qurat-ul-Ane Gillani and Asma Salam

Abstract:

In the present study, 49 Hybrid (Catla catla ♂ x Labeo rohita ♀) were sampled from Al-Raheem Fish Hatchery, Village Ali Pure Shamali, Jhang Road, 18 Km from Muzaffar Garh using a cast net and Live fishes were transported to research laboratory. Mean percentage for water found 79.13 %, ash 6.58 %, fat 2.22 % and protein content 12.06 % in whole wet body weight. It was observed that body constituents were found increasing in the same proportion with an increase in body weight while significant proportional increase was observed with total length. However, condition factor remained insignificant (P>0.05) with body constituents.

Keywords: Hybrid fish, Body composition, Condition factor, Predictive equations

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Authors: Saleh A. Al-Jufout

Abstract:

This paper presents a procedure of forming the mathematical model of radial electric power systems for simulation of both transient and steady-state conditions. The research idea has been based on nodal voltages technique and on differentiation of Kirchhoff's current law (KCL) applied to each non-reference node of the radial system, the result of which the nodal voltages has been calculated by solving a system of algebraic equations. Currents of the electric power system components have been determined by solving their respective differential equations. Transforming the three-phase coordinate system into Cartesian coordinate system in the model decreased the overall number of equations by one third. The use of Cartesian coordinate system does not ignore the DC component during transient conditions, but restricts the model's implementation for symmetrical modes of operation only. An example of the input data for a four-bus radial electric power system has been calculated.

Keywords: Mathematical Modelling, Radial Power System, Steady-State, Transients

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Authors: M. Zarei, A. Roozegar, R. Kazemzadeh, J.M. Kauffmann

Abstract:

This paper describes an efficient and practical method for economic dispatch problem in one and two area electrical power systems with considering the constraint of the tie transmission line capacity constraint. Direct search method (DSM) is used with some equality and inequality constraints of the production units with any kind of fuel cost function. By this method, it is possible to use several inequality constraints without having difficulty for complex cost functions or in the case of unavailability of the cost function derivative. To minimize the number of total iterations in searching, process multi-level convergence is incorporated in the DSM. Enhanced direct search method (EDSM) for two area power system will be investigated. The initial calculation step size that causes less iterations and then less calculation time is presented. Effect of the transmission tie line capacity, between areas, on economic dispatch problem and on total generation cost will be studied; line compensation and active power with reactive power dispatch are proposed to overcome the high generation costs for this multi-area system.

Keywords: Economic dispatch, Power System Operation, Direct Search Method, Transmission Capacity Constraint.

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Authors: Munnujahan Ara

Abstract:

In this paper, we investigate the effect of friendly jamming power allocation strategies on the achievable average secrecy rate over a bank of parallel fading wiretap channels. We investigate the achievable average secrecy rate in parallel fading wiretap channels subject to Rayleigh and Rician fading. The achievable average secrecy rate, due to the presence of a line-of-sight component in the jammer channel is also evaluated. Moreover, we study the detrimental effect of correlation across the parallel sub-channels, and evaluate the corresponding decrease in the achievable average secrecy rate for the various fading configurations. We also investigate the tradeoff between the transmission power and the jamming power for a fixed total power budget. Our results, which are applicable to current orthogonal frequency division multiplexing (OFDM) communications systems, shed further light on the achievable average secrecy rates over a bank of parallel fading channels in the presence of friendly jammers.

Keywords: Fading parallel channels, Wire-tap channel, OFDM, Secrecy capacity, Power allocation.

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Authors: Fayssal Amrane, Azeddine Chaiba

Abstract:

In this paper, type-2 fuzzy logic control (T2FLC) and neuro-fuzzy control (NFC) for a doubly fed induction generator (DFIG) based on direct power control (DPC) with a fixed switching frequency is proposed for wind generation application. First, a mathematical model of the doubly-fed induction generator implemented in d-q reference frame is achieved. Then, a DPC algorithm approach for controlling active and reactive power of DFIG via fixed switching frequency is incorporated using PID. The performance of T2FLC and NFC, which is based on the DPC algorithm, are investigated and compared to those obtained from the PID controller. Finally, simulation results demonstrate that the NFC is more robust, superior dynamic performance for wind power generation system applications.

Keywords: Doubly fed induction generetor, direct power control, space vector modulation, type-2 fuzzy logic control, neuro-fuzzy control, maximum power point tracking.

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Authors: Traian Chiulan, Brandusa Pantelimon

Abstract:

The paper analyzes the large power transformer unit regimes, indicating the criteria for the management of the voltage operating conditions, as well as the change in the operating conditions with the load connected to the secondary winding of the transformer unit. Further, the paper presents the software application for the evaluation of the transformer unit operation under different conditions. The software application was developed by means of virtual instrumentation.

Keywords: Operating regimes, power transformer, overload, lifetime, virtual instrumentation.

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Authors: K. Prajindra Sankar, S.K. Tiong, S.P. Johnny Koh

Abstract:

This paper presents a tested research concept that implements a complex evolutionary algorithm, genetic algorithm (GA), in a multi-microcontroller environment. Parallel Distributed Genetic Algorithm (PDGA) is employed in adaptive beam forming technique to reduce power usage of adaptive antenna at WCDMA base station. Adaptive antenna has dynamic beam that requires more advanced beam forming algorithm such as genetic algorithm which requires heavy computation and memory space. Microcontrollers are low resource platforms that are normally not associated with GAs, which are typically resource intensive. The aim of this project was to design a cooperative multiprocessor system by expanding the role of small scale PIC microcontrollers to optimize WCDMA base station transmitter power. Implementation results have shown that PDGA multi-microcontroller system returned optimal transmitted power compared to conventional GA.

Keywords: Microcontroller, Genetic Algorithm, Adaptiveantenna, Power optimization.

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Authors: Srikanta Bose, S.K. Mazumder

Abstract:

In the present simulation work, an attempt is made to study the switching dynamics of an optically controlled 4HSiC thyristor power semiconductor device with the use of GaAs optically triggered power transistor. The half-cell thyristor has the forward breakdown of 200 V and reverse breakdown of more than 1000 V. The optically controlled thyristor has a rise time of 0.14 μs and fall time of 0.065 μs. The turn-on and turn-off delays are 0.1 μs and 0.06 μs, respectively. In addition, this optically controlled thyristor is used as a control switch for the DC-DC Boost converter. The pn-diode used for the converter has the forward drop of 2.8 V and reverse breakdown of around 400 V.

Keywords: 4H-SiC, Boost converter, Optical triggering, Power semiconductor device, thyristor.

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Authors: M. Nikbakht, N. Choupani

Abstract:

In this paper delamination phenomenon in Carbon-Epoxy laminated composite material is investigated numerically. Arcan apparatus and specimen is modeled in ABAQUS finite element software for different loading conditions and crack geometries. The influence of variation of crack geometry on interlaminar fracture stress intensity factor and energy release rate for various mixed mode ratios and pure mode I and II was studied. Also, correction factors for this specimen for different crack length ratios were calculated. The finite element results indicate that for loading angles close to pure mode-II loading, a high ratio of mode-II to mode-I fracture is dominant and there is an opposite trend for loading angles close to pure mode-I loading. It confirms that by varying the loading angle of Arcan specimen pure mode-I, pure mode-II and a wide range of mixed-mode loading conditions can be created and tested. Also, numerical results confirm that the increase of the mode- II loading contribution leads to an increase of fracture resistance in the CF/PEI composite (i.e., a reduction in the total strain energy release rate) and the increase of the crack length leads to a reduction of interlaminar fracture resistance in the CF/PEI composite (i.e., an increase in the total interlaminar strain energy release rate).

Keywords: Fracture Mechanics, Mixed Mode, Arcan Specimen, Finite Element.

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Authors: N. Boutra, N. Ravot, J. Benoit, O. Picon

Abstract:

Submarine power cables used for offshore wind farms electric energy distribution and transmission are subject to numerous threats. Some of the risks are associated with transport, installation and operating in harsh marine environment. This paper describes the feasibility of an electromagnetic low frequency sensing technique for submarine power cable failure prediction. The impact of a structural damage shape and material variability on the induced electric field is evaluated. The analysis is performed by modeling the cable using the finite element method, we use sensitivity analysis in order to identify the main damage characteristics affecting electric field variation. Lastly, we discuss the results obtained.

Keywords: Electromagnetism, defect, finite element method, sensitivity analysis, submarine power cables.

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Authors: Alyaa M. Younes, Nermine Harraz, Mohammad H. Elwany

Abstract:

Lithium ion batteries are currently used for many applications including satellites, electric vehicles and mobile electronics. Their ability to store relatively large amount of energy in a limited space make them most appropriate for critical applications. Evaluation of the life of these batteries and their reliability becomes crucial to the systems they support. Reliability of Li-Ion batteries has been mainly considered based on its lifetime. However, another important factor that can be considered critical in many applications such as in electric vehicles is the cycle duration. The present work presents the results of an experimental investigation on the degradation behavior of a Laptop Li-ion battery (type TKV2V) and the effect of applied load on the battery cycle time. The reliability was evaluated using an accelerated life test. Least squares linear regression with median rank estimation was used to estimate the Weibull distribution parameters needed for the reliability functions estimation. The probability density function, failure rate and reliability function under each of the applied loads were evaluated and compared. An inverse power model is introduced that can predict cycle time at any stress level given.

Keywords: Accelerated life test, inverse power law, lithium ion battery, reliability evaluation, Weibull distribution.

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Authors: Arvind Kumar, Manoj Kumar, Dattatraya H. Nagaraj, Amanpreet Singh, Jayanthi Prattapati

Abstract:

The purpose of this paper is to study and compare two maximum power point tracking (MPPT) algorithms in a photovoltaic simulation system and also show a simulation study of maximum power point tracking (MPPT) for photovoltaic systems using perturb and observe algorithm and Incremental conductance algorithm. Maximum power point tracking (MPPT) plays an important role in photovoltaic systems because it maximize the power output from a PV system for a given set of conditions, and therefore maximize the array efficiency and minimize the overall system cost. Since the maximum power point (MPP) varies, based on the irradiation and cell temperature, appropriate algorithms must be utilized to track the (MPP) and maintain the operation of the system in it. MATLAB/Simulink is used to establish a model of photovoltaic system with (MPPT) function. This system is developed by combining the models established of solar PV module and DC-DC Boost converter. The system is simulated under different climate conditions. Simulation results show that the photovoltaic simulation system can track the maximum power point accurately.

Keywords: Incremental conductance Algorithm, Perturb and Observe Algorithm, Photovoltaic System and Simulation Results.

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Authors: N. Chayaopas, W. Assawinchaichote

Abstract:

In order to maximize energy capturing from wind energy, controlling the doubly fed induction generator to have optimal power from the wind, generator speed and output electrical power control in wind energy system have a great importance due to the nonlinear behavior of wind velocities. In this paper purposes the design of a control scheme is developed for power control of wind energy system via H∞ fuzzy integral controller. Firstly, the nonlinear system is represented in term of a TS fuzzy control design via linear matrix inequality approach to find the optimal controller to have an H∞ performance are derived. The proposed control method extract the maximum energy from the wind and overcome the nonlinearity and disturbances problems of wind energy system which give good tracking performance and high efficiency power output of the DFIG.

Keywords: H∞ fuzzy integral control, linear matrix inequality, wind energy system, doubly fed induction generator (DFIG).

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Authors: Umar Alhaji Mukhtar, Abubakar Mohammed El-jummah

Abstract:

This research involved the utilization of fluid flow energy to predict power output using Lead Zirconate Titanate (PZT) piezoelectric stacks. The aim of this work is to extract energy from a controlled level of pressure fluctuation in single-phase flow which forms a part of the energy harvesting technology that powers flow meters. A device- Perspex box was developed and fixed to 50.8 mm rig to induce pressure fluctuation in the flow. An experimental test was carried out using the single-phase water flow in the developed rig in order to measure the power output generation from the piezoelectric stacks. 16 sets of experimental tests were conducted to ensure the maximum output result. The acquired signal of the pressure fluctuation was used to simulate the expected electrical output from the piezoelectric material. The results showed a maximum output voltage of 12 V with an instantaneous output power of 1 µW generated, when the pressure amplitude is 2.6 kPa at a frequency of 2.4 Hz.

Keywords: Energy harvesting, experimental test, perspex rig, pressure fluctuation.

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Authors: Kayun Chantarasathaporn, Chonawat Srisa-an

Abstract:

Design Patterns have gained more and more acceptances since their emerging in software development world last decade and become another de facto standard of essential knowledge for Object-Oriented Programming developers nowadays. Their target usage, from the beginning, was for regular computers, so, minimizing power consumption had never been a concern. However, in this decade, demands of more complicated software for running on mobile devices has grown rapidly as the much higher performance portable gadgets have been supplied to the market continuously. To get along with time to market that is business reason, the section of software development for power conscious, battery, devices has shifted itself from using specific low-level languages to higher level ones. Currently, complicated software running on mobile devices are often developed by high level languages those support OOP concepts. These cause the trend of embracing Design Patterns to mobile world. However, using Design Patterns directly in software development for power conscious systems is not recommended because they were not originally designed for such environment. This paper demonstrates the adapted Design Pattern for power limitation system. Because there are numerous original design patterns, it is not possible to mention the whole at once. So, this paper focuses only in creating Energy Conscious version of existing regular "Builder Pattern" to be appropriated for developing low power consumption software.

Keywords: Design Patterns, Builder Pattern, Low Power Consumption, Object Oriented Programming, Power Conscious System, Software.

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Authors: Hasmayadi Abdul Majid, Rohana Musa

Abstract:

This paper presents the development of a 38.5 kS/s 10-bit low power SAR ADC which is realized in MIMOS’s 0.35 µm CMOS process. The design uses a resistive DAC, a dynamic comparator with pre-amplifier and SAR digital logic to create 10 effective bits while consuming less than 7.8 mW with a 3.3 V power supply.

Keywords: Successive Approximation Register Analog-to- Digital Converter, SAR ADC, Resistive DAC.

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Authors: Jung-Woon Lee, Jung-Taek Kim, Jae-Chang Park, In-Koo Hwang, Sung-Pil Lyu

Abstract:

Computerized alarm systems have been applied increasingly to nuclear power plants. For existing plants, an add-on computer alarm system is often installed to the control rooms. Alarm avalanches during the plant transients are major problems with the alarm systems in nuclear power plants. Computerized alarm systems can process alarms to reduce the number of alarms during the plant transients. This paper describes various alarm processing methods, an alarm cause tracking function, and various alarm presentation schemes to show alarm information to the operators effectively which are considered during the development of several computerized alarm systems for Korean nuclear power plants and are found to be helpful to the operators.

Keywords: Alarm processing, Alarm presentation, Alarm causetracking, Alarm logic diagram computerization, Alarm patternrecognition.

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Authors: Rafayel K. Kostanyan

Abstract:

The opportunities of use of metallic magnesium as a generator of hydrogen gas, as well as thermal and electric energy is presented in the paper. Various schemes of magnesium application are discussed and power characteristics of corresponding devices are presented. Economic estimation of hydrogen price obtained by different methods is made, including the use of magnesium as a source of hydrogen for transportation in comparison with gasoline. Details and prospects of our new inexpensive technology of magnesium production from magnesium hydroxide and magnesium bearing rocks (which are available worldwide and in Armenia) are analyzed. It is estimated the threshold cost of Mg production at which application of this metal in power engineering is economically justified.

Keywords: Magnesium, power generation, production, renewable energy.

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Authors: L.Ramesh, S.P.Chowdhury, S.Chowdhury, A.A.Natarajan, C.T.Gaunt

Abstract:

Accurate loss minimization is the critical component for efficient electrical distribution power flow .The contribution of this work presents loss minimization in power distribution system through feeder restructuring, incorporating DG and placement of capacitor. The study of this work was conducted on IEEE distribution network and India Electricity Board benchmark distribution system. The executed experimental result of Indian system is recommended to board and implement practically for regulated stable output.

Keywords: Distribution system, Distributed Generation LossMinimization, Network Restructuring

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Authors: Shin-Shin Kao, Yuan-Kang Shih, Hsun Su

Abstract:

In this paper, we show that the conjecture of Chv tal, which states that any 1-tough graph is either a Hamiltonian graph or its complement contains a specific graph denoted by F, does not hold in general. More precisely, it is true only for graphs with six or seven vertices, and is false for graphs with eight or more vertices. A theorem is derived as a correction for the conjecture.

Keywords: Complement, degree sum, Hamiltonian, tough.

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Authors: K. N. C. Njoku, Chinwendu Best Eleje, Christian Chukwuemeka Nwandu

Abstract:

One of the problems facing most insurance companies is how best the burden of paying claims to its policy holders can be managed whenever need arises. Hence there is need for the insurer to buy a reinsurance contract in order to reduce risk which will enable the insurer to share the financial burden with the reinsurer. In this paper, the insurer’s and reinsurer’s strategy is investigated under the modified constant elasticity of variance (M-CEV) process and proportional administrative charges. The insurer considered investment in one risky asset and one risk free asset where the risky asset is modeled based on the M-CEV process which is an extension of constant elasticity of variance (CEV) process. Next, a nonlinear partial differential equation in the form of Hamilton Jacobi Bellman equation is obtained by dynamic programming approach. Using power transformation technique and variable change, the explicit solutions of the optimal investment strategy and optimal reinsurance strategy are obtained. Finally, some numerical simulations of some sensitive parameters were obtained and discussed in details where we observed that the modification factor only affects the optimal investment strategy and not the reinsurance strategy for an insurer with exponential utility function.

Keywords: Reinsurance strategy, Hamilton Jacobi Bellman equation, power transformation, M-CEV process, exponential utility.

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