Bidding Strategy in Spot Markets with Definition of a New Market Power Index by Using Conjectural Variation

Hafezi_Nasab, M.; Rashidinejad, M.; Abdollahi, A.; Taheri, I.

doi:10.22061/jecei.2014.243

Document Type : Original Research Paper

Authors

Department of Electrical Engineering, Faculty of Engineering, Shahid Bahonar University of Kerman, Kerman, Iran

https://doi.org/10.22061/jecei.2014.243

Abstract

In this paper, the concept of Conjectural Variation (CV) is used to specify optimal generation decision for generation companies (Gencos). The conjecture of Genco is defined as its belief or expectation about the reaction of rivals to change of its output. Using CV method, each Genco has to learn and estimate strategic behaviors of other competitors from available historical market operation data. Therefore, accuracy of generation decision depends on the accuracy of estimating other competitors’ decision within CV context. In this paper, adjusted Lerner index is used to improve the accuracy of estimating CV parameter. In electricity market, the adjusted Lerner index can be directly computed using price, market shares, marginal cost and industry elasticity of demand. It must be noted that due to repeated power market, Gencos need to modify their behavior over time. In response to this need, dynamic learning is considered in case studies which improve results.

Keywords

20.1001.1.23223952.2014.2.2.2.1

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Journal of Electrical and Computer Engineering Innovations (JECEI)

Bidding Strategy in Spot Markets with Definition of a New Market Power Index by Using Conjectural Variation

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Volume 2, Issue 2 - Serial Number 4
July 2014
Pages 63-68

Bidding Strategy in Spot Markets with Definition of a New Market Power Index by Using Conjectural Variation

References

References

Send comment about this article

Volume 2, Issue 2 - Serial Number 4July 2014Pages 63-68

Volume 2, Issue 2 - Serial Number 4
July 2014
Pages 63-68