Inverse Optimization for the Recovery of Market Structure from Market Outcomes: An Application to the MISO Electricity Market

2014 ◽  
Author(s):  
John R. Birge ◽  
Ali Hortacsu ◽  
Michael Pavlin
Keyword(s):  
Market Structure ◽  
Electricity Market ◽  
Inverse Optimization ◽  
Market Outcomes

scholarly journals Competition in Power Generation: Ex-ante Analysis of Indonesia’s Electricity Market

Energies ◽  
2020 ◽  
Vol 13 (24) ◽  
pp. 6741
Author(s):  
Dzikri Firmansyah Hakam ◽  
Sudarso Kaderi Wiyono ◽  
Nanang Hariyanto
Keyword(s):  
Power System ◽  
Market Structure ◽  
Market Power ◽  
Electricity Markets ◽  
Electricity Market ◽  
Regulatory Reform ◽  
Optimal Number ◽  
Load Flow ◽  
Utility Company ◽  
Competitive Electricity Markets

This research optimises the mix and structure of Generation Companies (GenCos) in the Sumatra power system, Indonesia. Market power, indicating the ability to raise prices profitably above the competitive level, tends to be a significant problem in the aftermath of electricity market restructuring. In the process of regulatory reform and the development of competitive electricity markets, it is desirable and practical to establish an efficient number of competitor GenCos. Simulations of a power system account for multi-plant mergers of GenCos subject to a regulatory measure of the Residual Supply Index and the influence of direct current load flow and the topology of the system. This study simulates the Sumatra power system in order to determine the following: optimal market structure, efficient GenCo generation mix, and the optimal number of competitive GenCos. Further, this study seeks to empirically optimise the electricity generation mix and electricity market structure of the Sumatra power system using DC load flow optimisation, market power index, and multi-plant monopoly analysis. The simulations include generation and transmission constraints to represent network constraints. This research is the first to analyse the Sumatra power system using imperfect (Cournot) competition modelling. Furthermore, this study is the first kind to optimise the mix and structure of the Sumatra generation power market. The guidelines and methodology in this research can be implemented in other countries characterised by a monopoly electricity utility company.

Capturing Electricity Market Dynamics in the Optimal Trading of Strategic Agents using Neural Network Constrained Optimization

2021 ◽  
Author(s):  
Mihály Dolányi ◽  
Kenneth Bruninx ◽  
Jean-François Toubeau ◽  
Erik Delarue
Keyword(s):  
Neural Network ◽  
Electricity Markets ◽  
Electricity Market ◽  
Mathematical Program ◽  
Market Dynamics ◽  
Equilibrium Constraints ◽  
Market Outcomes ◽  
Optimal Trading ◽  
Optimal Bidding ◽  
Upper Level

In competitive electricity markets the optimal trading problem of an electricity market agent is commonly formulated as a bi-level program, and solved as mathematical program with equilibrium constraints (MPEC). In this paper, an alternative paradigm, labeled as mathematical program with neural network constraint (MPNNC), is developed to incorporate complex market dynamics in the optimal bidding strategy. This method uses input-convex neural networks (ICNNs) to represent the mapping between the upper-level (agent) decisions and the lower-level (market) outcomes, i.e., to replace the lower-level problem by a neural network. In a comparative analysis, the optimal bidding problem of a load agent is formulated via the proposed MPNNC and via the classical bi-level programming method, and compared against each other.

Emissions Trading, Electricity Restructuring, and Investment in Pollution Abatement

2010 ◽  
Vol 100 (3) ◽  
pp. 837-869 ◽  
Author(s):  
Meredith Fowlie
Keyword(s):  
Electricity Markets ◽  
Electricity Market ◽  
Emissions Trading ◽  
Pollution Abatement ◽  
State Level ◽  
Economic Regulation ◽  
Market Outcomes ◽  
Capital Intensive ◽  
Trading Program ◽  
Stationary Sources

This paper analyzes an emissions trading program that was introduced to reduce smog-causing pollution from large stationary sources. Using variation in state level electricity industry restructuring activity, I identify the effect of economic regulation on pollution permit market outcomes. There are two main findings. First, deregulated plants in restructured electricity markets were less likely to adopt more capital intensive environmental compliance options as compared to regulated or publicly owned plants. Second, as a consequence of heterogeneity in electricity market regulations, a larger share of the permitted pollution is being emitted in states where air quality problems tend to be more severe. (JEL L51, L94, L98, Q53, Q58)

scholarly journals The Competitive Effects of Transmission Infrastructure in the Indian Electricity Market

2021 ◽  
Vol 13 (2) ◽  
pp. 202-242
Author(s):  
Nicholas Ryan
Keyword(s):  
Power Supply ◽  
Electricity Market ◽  
Power Market ◽  
Local Market ◽  
Market Outcomes ◽  
Competitive Effects ◽  
Transmission Expansion ◽  
Market Competitiveness ◽  
Set Up ◽  
Market Surplus

The integration of markets may improve efficiency by lowering costs or reducing local market power. India, seeking to reduce electricity shortages, set up a new power market, in which transmission constraints sharply limit trade between regions. During congested hours, measures of market competitiveness fall and firms raise bid prices. I use confidential bidding data to estimate the costs of power supply and simulate market outcomes with more transmission capacity. Counterfactual simulations show that transmission expansion increases market surplus by 22 percent, enough to justify the investment. One-third of this gain is due to sellers’ response to a more integrated grid. (JEL H54, L13, L94, O13, Q41)

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