Primary energy consumption in the power generation sector and various market structures: a modelling approach

Kamiński Jacek ()
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Kamiński Jacek: Mineral and Energy Economy Research Institute, Polish Academy of Sciences Energy and Environmental Policy Division, Krakow, Poland

Gospodarka Surowcami Mineralnymi / Mineral Resources Management, 2014, vol. 30, issue 4, 14

Abstract: This paper presents a computable model that can be applied to examinations of primary energy supplies to the power sector given various market structures. Although a similar problem has been already studied, in particular in the context of environmental regulations and technological progress, it would appear prior works have not approached this issue in the context of market structures. This study has formulated a model that enables such analyses to be carried out. The model developed in this article is based upon the game theory approach; Cournot with the inclusion of conjectural variations. It has been formulated as a Mixed Complementarity Problem (MCP), a general mathematical framework which is particularly well suited for modelling energy systems. The model explicitly distinguishes two wholesale electricity trading platforms, namely the day-ahead (DAM), and the bilateral (OTC) market. The model can be implemented in a modelling systems that are frequently used for development of computable models of power systems. Apart from analyses of primary energy consumption in the power generation sector, the model is capable of carrying out welfare analyses, in particular impact analyses regarding: consumer and producer surpluses, dead weight loss, prices and quantities produced. The research presented in this paper will be further complemented with data collection and calibration of the model.

Date: 2014
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:gosmin:v:30:y:2014:i:4:p:14:n:7

DOI: 10.2478/gospo-2014-0038

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