Need and design of short-term auctions in the EU gas markets

Miguel Vazquez () and Michelle Hallack

Energy Policy, 2013, vol. 63, issue C, 484-493

Abstract: In the EU, gas markets are based on socializing network flexibility services. However, shippers have different preferences on network flexibility, which are not reflected in current allocation models. We propose the introduction of auction mechanisms to allocate network services in the short run. The auction aims to represent simultaneously the diversity of players′ preferences and the trade-offs implied by network constraints. Two sealed-bid auctions are proposed: (a) an auction based on bids for gas, which allocates network services through the minimization of gas price differences; (b) an auction with explicit bids for line-pack, which allows shippers′ valuation of line-pack storage.

Keywords: Auction design; Entry/exit capacity allocation; Combinatorial auctions (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:63:y:2013:i:c:p:484-493

DOI: 10.1016/j.enpol.2013.08.006

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