Investigating minimum income condition orders on European power exchanges: Controversial properties and enhancement proposals

Dániel Divényi, Beáta Polgári, Ádám Sleisz, Péter Sőrés and Dávid Raisz

Applied Energy, 2021, vol. 281, issue C, No S0306261920315002

Abstract: One of the most difficult challenges of deregulated electricity markets is the proper management and operation planning of economically non-convex generators. The origin of economic non-convexity is twofold. Firstly, generators generally have non-zero minimum output power (MOP) levels, below which they cannot sustain operation. Secondly, they might have substantial fixed costs. The direct consideration of these characteristics leads to very hard non-convex mathematical problems with the increased probability of computational difficulties and long solution time for the market clearing process.

Keywords: Power exchange; Power generation; Economic modeling; Mathematical programming; Internal energy market (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1016/j.apenergy.2020.116070

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