Introduction to statistics and

probability theory

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Outline
 Definition of Probability
 Importance of Probability Theory
 Probability Theory

 Set Theory
 Basic Probability Concepts
 Combinations Theory
 Conditional Probability and Bayesian Theorem
 Random Variables
 Definition of Statistics
 Least Square Method
 Example on Probability
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 Definition of Probability

Mathematical Definition Statistical Definition

Probability is a method of determining Probability is calculated using available
how likely something is to occur. An event data, frequencies, or prior experiences:
occurs (a) times and does not occur (b)
times, and all possibilities are equally Where:
likely. r=Relative Frequency
- Probability of happening of an event : N=Number of the items
- Probability of not happening of an event :

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Importance of Probability Theory

 Basis of Statistical Laws

 Specific importance in insurance Business
 Importance in games of chance
 Using in sampling
 Basis of tests of Hypothesis and test of significance

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 Probability Theory
Probability Theory

Conditional Basic Bayesian Random Probability Bathtub

Set Theory Probability Theory of Theorem Variables Distributions Curve
Probability Combinations
Concepts

Combinations

Permutations

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 Set Theory

 Set theory and basic probability concepts are used to begin the mathematical representation of probability
theory.
 Set theory is an area of mathematics that deals with the properties of well-defined collections of objects that
may or may not be mathematical in nature, such as numbers or functions.
 Sample Space (S) : The set of all possible outcomes of an experiment, (discrete or continuum values).
 Event (E) : a specified set of possible outcomes in a sample space S.
 E1 ϵ S: E1 is an element of S.
 Empty set: denoted by φ
 S = {E1,E2, ….,En}, S = {E1,E2,…..}, S ={E; E satisfies P}, S = {x; 0 ≤ x ≤1}

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 Set Theory

Venn diagram showing subset, intersection, and union

we say that S is a subset of T

Ω : a universal set

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Set Theory

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 Basic Probability Concepts

 Two elements of a probabilistic model are: The sample space Ω , a set A of possible outcomes.
 P (A) : probability of A.
 Probabilities of outcomes are usually estimated from relative frequencies with which the outcomes occur when
the experiment is repeated many times.
 probabilities must satisfy three requirements:
1. The probability of each outcome must be a number between 0 and 1.
2. P (A1 U A2 U A3) = P(A1) + P(A2) + P(A3) , If A1, A2, and A3, their intersection is empty set
3. The sum of probabilities of all outcomes in a given sample space is 1.
 The probability of an impossible event (the empty or null set) is zero.
 P(A) = number of elements of A/n , where n = possible outcomes that are equally likely in the sample space

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Basic Probability Concepts

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 Theory of Combinations

 The Pascal triangle and the concepts of factorial form the foundation of the theory of combinations.
 The theory of combinations determines the possible grouping of objects
 n! = 1 x 2 x 3 x ….x (n-1) x n.
 0! = 1

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Theory of Combinations

1- Permutations
- A permutation is an arrangement in which the objects of a group are arranged in a certain sequence.

Repetition is not allowed:

N : the number of possibilities
n : a number of objects
r : a number of objects in a set
( the n is a number of things to choose from, and you choose r of them).

Repetition is allowed:
the number of possibilities (N) is calculated considering a number of objects (n) and considering a
number of objects in a set (r)

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Theory of Combinations

1- Combinations
- A permutation is an arrangement in which the objects of a group are arranged in a certain sequence.
Combinations Without Repetition:
N : the number of possibilities
n : a number of objects
r : a number of objects in a set
( the n is a number of things to choose from, and you choose r of them).

Combinations With Repetition:

the number of possibilities (N) is calculated considering a number of objects (n) and considering a
number of objects in a set (r)

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 Conditional Probability
 A conditional probability of an event is the probability given that another event has occurred.
 In general, p(A|B) is the probability of event A given that event B occurred.

example of
probability tree

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 Bayesian Theorem

 Bayes theorem is a theorem of probability theory, which can be seen as a way of understanding how the
probability that a theory is true is affected by a new piece of evidence.
 A general form:

where A1, A2, . . . , An is a set of mutually exclusive and exhaustive events (i = 1, . . . , n),

.
B = the observation,
= is the likelihood that the probability of the observation given is true,
is the posterior probability, i.e., the probability of now that B is known.

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 Random Variables

 A random variable is any variable determined by chance and with no predictable relationship to any other
variable.
 Two methods are known to get the random variables
1) Measuring a physical phenomenon that is expected to be random.
2) Running a pseudorandom variable generator that is a computational algorithm determined by a
seed.
 If the example of interest is more complex than tossing a coin or die, the term distribution becomes
important.

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 Definition of Statistic

is the study of data collection, analysis, presentation, and interpretation, as

well as the making of decisions based on such analyses.

Types of Statistics:
 Descriptive Statistics includes methods for organizing, displaying, and
describing data through the use of tables, graphs, and summary
measures.
 Inferential Statistics consists of methods for using sample results to help
make decisions or predictions about a population.
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 Least Square Method
160

It is a form of mathematical regression analysis 140

used to determine the line of best fit for a set of 120

100
data, providing a visual demonstration of the
yp1
80
yp2
relationship between the data points. Each point yp3

y
exp1
60
yp

of data represents the relationship between a 40

known independent variable and an unknown 20

dependent variable. 0
0 100 200 300 400 500 600

-20 x
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 Least Square Method
 Advantages and Disadvantages of the Least Squares Method

 One of the main advantages of employing this strategy is that it is simple to use and understanding.

 Investors and analysts can use the least square approach to forecast future economic and stock market trends
by studying historical performance. As such, it may be utilized to make decisions.

X The major drawback of the least square approach is the data employed. It can only illustrate the link between
two variables. As a result, it disregards all others. And if there are any outliers, the findings get biased.

X The data must be evenly distributed. If this isn't the case, the results may not be reliable.

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 Least Square Method
 To find the line of best fit for N points

Step 1: Collect Data: Gather a set of data points (x, y) from your
experiment or observation.
Step 2: Calculate the Mean: Find the mean (average) of the y-
values (​).
Step 3: Calculate the Deviations: Calculate the square of the
deviations of each data point of (y) from the mean.
Step 4: Define the Model: Start by defining the mathematical
model that represents the relationship between the independent
variable (x) and the dependent variable (y).

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 Least Square Method
Step 5: calculates the least squares estimates for A and B in the
linear model
where A is the slope and B is the y-intercept.
Step 6: Square the Residuals: Residuals () are the differences
between the observed values and the predicted values.

Calculate the squared residuals

Step 7: Sum of Squared Errors (SSE): Sum up all the squared

residuals to get the Sum of Squared Errors (SSE).

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 Least Square Method
Step 8: Mean Squared Error (MSE): Optionally, you may calculate
the Mean Squared Error (MSE) by dividing the SSE by the number
of observations (n).

MSE provides an average measure of the squared errors.

Step 9: Assess the Fit: The R-squared () value is a statistical
measure of how well the regression line approximates the real
data points. Examine the value. A higher indicates a better fit.

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 Least Square Method

 Keep in mind that these steps outline the basic procedure for
simple linear regression. For multiple linear regression or
other more complex models, the process is similar, but the
calculations involve matrices and vectors.

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 Example on Probability
The system contains 4 stations with 6 generation units. Table 1 consists the Forced Outage Rate FOR of each station. The
installed capacity of this system is 280 MW with peak load of 200 MW.

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 Example on Probability
According to Table 1, the probability of the outage units according to the below equations are illustrate in Table 2
Table 2 - Probability of outage the units

Generating Force Outage Number of

Station Rate (FOR) Units/GS p MW/Unit FACT(n) Outage of Units
sum of probabilities of
all outcomes
q n 1-q n! 0 1 2
Pr Pr Pr
1 0.03 2 0.97 25 2 0.9409 0.0582 0.0009 1
2 0.02 2 0.98 40 2 0.9604 0.0392 0.0004 1
3 0.01 1 0.99 50 1 0.9900 0.0100 0 1
4 0.01 1 0.99 100 1 0.9900 0.0100 0 1
Installed Capacity 280

, p=1-q
Where,
- Probability of the outage each unit , n- Number of Units in each generation station
r - The Number of outage units , q - Force outage rate FOR

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 Example on Probability
Table 3 - Capacity outage with its probability for the test system

According to the case study in Table 1, there are Case No. (i)
Out of Unit 1
(MW)
Out of Unit 2
(MW)
Out of Unit 3
(MW)
Out of Unit 4
(MW)
Total Outage of
Units oi (MW)
P1 P2 P3 P4 Probability (Pi)

1 0 0 0 0 0 0.9409 0.9604 0.99 0.99 0.885657916836

36 cases of possibilities for the outage units. 2
3
25
0
0
40
0
0
0
0
25
40
0.0582
0.9409
0.9604
0.0392
0.99
0.99
0.99
0.99
0.054782963928
0.036149302728
4 0 0 50 0 50 0.9409 0.9604 0.01 0.99 0.008946039564

The outage power of each generation unit with 5

6
7
50
25
25
0
40
0
0
0
50
0
0
0
50
65
75
0.0009
0.0582
0.0582
0.9604
0.0392
0.9604
0.99
0.99
0.01
0.99
0.99
0.99
0.000847159236
0.002236039344
0.000553363272
8 0 80 0 0 80 0.9409 0.0004 0.99 0.99 0.000368870436

the probability of the total capacity outage are 9

10
0
50
40
40
50
0
0
0
90
90
0.9409
0.0009
0.0392
0.0392
0.01
0.99
0.99
0.99
0.000365144472
0.000034577928
11 0 0 0 100 100 0.9409 0.9604 0.99 0.01 0.008946039564
12 50 0 50 0 100 0.0009 0.9604 0.01 0.99 0.000008557164

illustrated in 13
14
25
25
80
40
0
50
0
0
105
115
0.0582
0.0582
0.0004
0.0392
0.99
0.01
0.99
0.99
0.000022816728
0.000022586256
15 25 0 0 100 125 0.0582 0.9604 0.99 0.01 0.000553363272
16 0 80 50 0 130 0.9409 0.0004 0.01 0.99 0.000003725964
Table 3. 17
18
50
0
80
40
0
0
0
100
130
140
0.0009
0.9409
0.0004
0.0392
0.99
0.99
0.99
0.01
0.000000352836
0.000365144472
19 50 40 50 0 140 0.0009 0.0392 0.01 0.99 0.000000349272
20 0 0 50 100 150 0.9409 0.9604 0.01 0.01 0.000090364036
21 50 0 0 100 150 0.0009 0.9604 0.99 0.01 0.000008557164
22 25 80 50 0 155 0.0582 0.0004 0.01 0.99 0.000000230472
23 25 40 0 100 165 0.0582 0.0392 0.99 0.01 0.000022586256
24 25 0 50 100 175 0.0582 0.9604 0.01 0.01 0.000005589528
25 0 80 0 100 180 0.9409 0.0004 0.99 0.01 0.000003725964
26 50 80 50 0 180 0.0009 0.0004 0.01 0.99 0.000000003564
27 0 40 50 100 190 0.9409 0.0392 0.01 0.01 0.000003688328
28 50 40 0 100 190 0.0009 0.0392 0.99 0.01 0.000000349272
29 50 0 50 100 200 0.0009 0.9604 0.01 0.01 0.000000086436
30 25 80 0 100 205 0.0582 0.0004 0.99 0.01 0.000000230472
31 25 40 50 100 215 0.0582 0.0392 0.01 0.01 0.000000228144
32 0 80 50 100 230 0.9409 0.0004 0.01 0.01 0.000000037636
33 50 80 0 100 230 0.0009 0.0004 0.99 0.01 0.000000003564
34 50 40 50 100 240 0.0009 0.0392 0.01 0.01 0.000000003528
35 25 80 50 100 255 0.0582 0.0004 0.01 0.01 0.000000002328
36 50 80 50 100 280 0.0009 0.0004 0.01 0.01 0.000000000036
1.000000000000

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 References
• Cepin, Marko. 2011, Assessment of Power System Reliability methods and applications, British Library Cataloguing,

Springer London Dordrecht Heidelberg New York

• L T Al-Bahrani1, W Saaed, M Al-Kaabi, (2020), Generation Reliability Enhancement based on Reliability Indices. 2nd

International Conference on Science & Technology (2020 2nd ICoST), Journal of Physics: Conference Series 1844 (2021)

012010, 1-10. Generation Reliability Enhancement based on Reliability Indices - IOPscience

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