Implicit Auctioning on the Kontek Cable: Third Time Lucky?

Leonardo Meeus

No 2010/49, RSCAS Working Papers from European University Institute

Abstract: Cross-border capacities in Europe are currently inefficiently used. Implicit auctioning is about eliminating these cross-border trade inefficiencies by internalizing the arbitrage into the auction procedures of the Power Exchanges that are organizing trade nationally. On the Kontek Cable, implicit auctioning has been implemented without price coordination between the involved Power Exchanges. This implementation, referred to as “volume or dome coupling” as opposed to “price coupling”, has been argued to be institutionally easier to implement. The Kontek Cable experimented with three different implicit auctioning implementations whose performance we analyze empirically in this paper. We find that the third implementation is significantly outperforming the previous two implementations, but in this third implementation stakeholders partly abandoned the volume coupling approach they initially believed to be a viable alternative to price coupling.

Keywords: electricity; transmission; congestion management; market coupling (search for similar items in EconPapers)
Date: 2010-05-28
New Economics Papers: this item is included in nep-ene
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Citations: View citations in EconPapers (2)

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Journal Article: Implicit auctioning on the Kontek Cable: Third time lucky? (2011)
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