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Equilibrium Predictions in Wholesale Electricity Markets

  • Talat S. Genc
Chapter
Part of the Energy Systems book series (ENERGY)

Abstract

We review supply function equilibrium models and their predictions on market outcomes in the wholesale electricity auctions. We discuss how observable market characteristics such as capacity constraints, number of power suppliers, load distribution and auction format affect the behavior of suppliers and performance of the market. We specifically focus on the possible market power exerted by pivotal suppliers and the comparison between discriminatory and uniform-price auctions. We also describe capacity investment behavior of electricity producers in the restructured industry.

Keywords

Capacity investment. Electricity auctions Electricity markets Markov perfect equilibrium Pivotal suppliers Supply function equilibrium 

Notes

Acknowledgements

I thank the corresponding editor Panos Pardalos and the anonymous referees for useful comments and suggestions. This research is supported by the Social Sciences and Humanities Research Council of Canada (SSHRC).

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Copyright information

© Springer-Verlag Berlin Heidelberg 2012

Authors and Affiliations

  • Talat S. Genc
    • 1
  1. 1.Department of EconomicsUniversity of GuelphGuelphCanada

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