Evaluating individual market power in electricity markets via agent-based simulation

We use agent-based simulation in a coordination game to analyse the possibility of market power abuse in a competitive electricity market. The context of this was a real application to the England and Wales electricity market as part of a Competition Commission Inquiry into whether two particular ge...

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Bibliographic Details
Published in:Annals of operations research 2003-07, Vol.121 (1), p.57
Main Authors: Bunn, Derek W, Oliveira, Fernando S
Format: Article
Language:English
Subjects:
Competition
Design
Electricity
Electricity distribution
Equilibrium
Game theory
Generators
Market prices
Market shares
Operations research
Simulation
Studies
Suppliers
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Summary:We use agent-based simulation in a coordination game to analyse the possibility of market power abuse in a competitive electricity market. The context of this was a real application to the England and Wales electricity market as part of a Competition Commission Inquiry into whether two particular generators could profitably influence wholesale prices. The research contributions of this paper are both in the areas of market power and market design policy issues for electricity markets, and in the methodological use of large industry-wide evolutionary simulation models. [PUBLICATION ABSTRACT]
ISSN:0254-5330
1572-9338
DOI:10.1023/A:1023399017816