Competitive Behavior of Hydroelectric Power Plants under Uncertainty in Spot Market

Marcelle Caroline Thimotheo de Brito (), Amaro O. Pereira Junior, Mario Veiga Ferraz Pereira, Julio César Cahuano Simba and Sergio Granville
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Marcelle Caroline Thimotheo de Brito: PPE—Energy Planning Program, Federal University of Rio de Janeiro, Rio de Janeiro 21941-901, Brazil
Amaro O. Pereira Junior: PPE—Energy Planning Program, Federal University of Rio de Janeiro, Rio de Janeiro 21941-901, Brazil
Mario Veiga Ferraz Pereira: PSR Energy Consulting and Analytics, Rio de Janeiro 22250-040, Brazil
Julio César Cahuano Simba: PSR Energy Consulting and Analytics, Rio de Janeiro 22250-040, Brazil
Sergio Granville: PSR Energy Consulting and Analytics, Rio de Janeiro 22250-040, Brazil

Energies, 2022, vol. 15, issue 19, 1-22

Abstract: This article aims to analyze agents’ behavior in a competitive hydrothermal energy market. The idea is to investigate how much the day-to-day behavior of the market can be different from the predictions presented by cost-based models because of the risk perception of each agent (hydroelectric energy producer, in this case) as a participant of the market. The main contribution is in determining the impact on the agents’ revenue in the short-term market due to the variation in the amount of energy generated and the market price, which other methodologies may not be able to capture. For this reason, a case study was made using daily simulations in a given month, observing the strategy and bids of eight hydroelectric agents for a central market operator emulated by an energy price offer simulator called SOPEE. The study reflected qualitative and quantitative examples of how the risk perception and the behavior of each agent can influence market behavior due to the variation in their perceptions of the parameters that form the energy price.

Keywords: game theory; optimal bid; competitive energy market; hydrothermal system; risk perception; risk profile (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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