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Market Power in Hydro-Thermal Systems with Marginal Cost Bidding

Market Power in Hydro-Thermal Systems with Marginal Cost Bidding

Category
Part of a book/report
Abstract
Traditionally, electricity markets have been designed with the intention of disabling producer side market power or prohibiting exercising it. Nonetheless it can be assumed that players participating in pool markets and aiming to maximize their individual benefits might depart from the optimum in terms of total system welfare. To recognize and analyze such behavior, system operators have a wide range of methods available. In the here presented paper, one of those methods - deriving a supply function equilibrium - is used and nested in a traditional discontinuous Nash game. The result is a case study that shows that marginal cost bidding thermal producers have an incentive to collaborate on scheduling in order to cause similar effects to tacit collusion
Client
  • Norges forskningsråd / 243964
Language
English
Author(s)
Affiliation
  • Norwegian University of Science and Technology
  • SINTEF Energy Research / Energisystemer
Year
2018
Published in
International Conference on the European Energy Market
ISSN
2165-4093
Publisher
IEEE conference proceedings
Book
2018 15th International Conference on the European Energy Market - EEM
Booklet
2018
ISBN
978-1-5386-1488-4