X-Model: Further Development and Possible Modifications

Sergei Kulakov
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Sergei Kulakov: Environmental Economics, esp. Economics of Renewable Energy, University of Duisburg-Essen, Berliner Platz 6-8, WST-C.11.19, 45127 Essen, Germany

Forecasting, 2020, vol. 2, issue 1, 1-16

Abstract: The main goal of the present paper is to improve the X-model used for day-ahead electricity price and volume forecasting. The key feature of the X-model is that it makes a day-ahead forecast for the entire wholesale supply and demand curves. The intersection of the predicted curves yields the forecast for equilibrium day-ahead prices and volumes. We take advantage of a technique for auction curves’ transformation to improve the original X-model. Instead of using actual wholesale supply and demand curves, we rely on transformed versions of these curves with perfectly inelastic demand. As a result, the computational requirements of our X-model are reduced and its forecasting power increases. Moreover, our X-model is more robust towards outliers present in the initial auction curves’ data.

Keywords: energy economics; energy forecasting; econometric modeling; electricity supply; electricity demand (search for similar items in EconPapers)
JEL-codes: A1 B4 C0 C1 C2 C3 C4 C5 C8 M0 Q2 Q3 Q4 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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