Electricity retailers’ behavior in a highly competitive Nordic electricity market

Iliana Ilieva and Steven A. Gabriel

Journal of Energy Markets

Abstract: ABSTRACT The integration of the national electricity retail markets in the Nordic region is expected to intensify competition among retailers. At the same time, technological developments will make possible the creation of a smart electricity grid that includes smart meters, two-way communication and real-time pricing. With the help of smart-meter technologies, retailers will be able to significantly increase the range of their service offers, allowing customers to choose from a variety of retail products. We describe the present status of the Nordic retail market for electricity and discuss the likely impact of a pending regulatory change to the common Nordic end-user market based on the functionalities offered by smart metering. In particular, we investigate the effects on competing retailers' profit, price markup and service investment by formulating a nonlinear program and solving it for numerical values that have been calibrated to be close to reality. The results from model simulations for a two-retailer case indicate that price and service decisions made by one retailer have a strong impact on the market strategy of the other. The range of this impact depends on the overall level of price markup values.

References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.risk.net/journal-of-energy-markets/238 ... c-electricity-market (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rsk:journ2:2385806

Access Statistics for this article

More articles in Journal of Energy Markets from Journal of Energy Markets
Bibliographic data for series maintained by Thomas Paine ().