A Comparison of Electricity Market Designs in Networks

Andreas Ehrenmann and Karsten Neuhoff ()

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: In the real world two classes of market designs are implemented to trade electricity in transmission constrained networks. Analytical results show that in two node networks integrated market designs reduce the ability of electricity generators to exercise market power relative to separated market designs. In multi node networks countervailing effects make an analytic analysis difficult. We present a formulation of both market designs as an equilibrium problem with equilibrium constraints. We find that in a realistic network, prices are lower with the integrated market design.

Pages: 29
Date: 2003-09
New Economics Papers: this item is included in nep-com
Note: CMI, IO
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Citations: View citations in EconPapers (14)

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Related works:
Journal Article: A Comparison of Electricity Market Designs in Networks (2009)
Working Paper: A Comparison of Electricity Market Designs in Networks (2003)
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