A VCG Auction for Electricity Storage

Thomas Greve () and Michael Pollitt

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

Abstract: Energy storage seems set to play a key role in managing and balancing the future electricity system. Storage can act as a generator and as a load, providing both energy and ancillary services such as fast frequency response and operating reserve. Therefore, it can provide the desired flexibility for the network. Current mechanism designs do not take advantage of the full potential of a given storage facility and the auctions used to buy and sell potential storage products have design flaws. This paper gives an overview of how storage products are bought and sold today and the problems of the current designs. It then presents a new mechanism design to integrate storage in the most efficient way, based on social welfare.

Keywords: Electricity storage; interconnectors; auctions (search for similar items in EconPapers)
JEL-codes: D44 D85 Q42 (search for similar items in EconPapers)
Date: 2016-04-25
New Economics Papers: this item is included in nep-ene and nep-reg
Note: mgp20
References: View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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Related works:
Working Paper: A VCG Auction for Electricity Storage (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:cam:camdae:1628

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