QUANTIFYING MARKET POWER IN THE GERMAN WHOLESALE ELECTRICITY MARKET USING A DYNAMIC MULTI-REGIONAL DISPATCH MODEL

This paper quantifies the degree of market power in the German wholesale electricity market. A dispatch model simulates competitive marginal costs. In addition to common input factors like plant capacities, fuel prices and load structures, the model also incorporates international power exchange and...

Full description

Saved in:
Bibliographic Details
Published in:The Journal of industrial economics 2006-12, Vol.54 (4), p.471-498
Main Author: MÜSGENS, FELIX
Format: Article
Language:English
Subjects:
Cost estimates
Cost estimation models
Economic models
Electricity
Energy industry
Estimators
Marginal costs
Market power
Market prices
Prices
Producer surplus
Start up firms
Startup costs
Studies
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:This paper quantifies the degree of market power in the German wholesale electricity market. A dispatch model simulates competitive marginal costs. In addition to common input factors like plant capacities, fuel prices and load structures, the model also incorporates international power exchange and dynamic effects like start-up costs and hydro storage plant dispatch. The simulated prices are subsequently used as a benchmark for observed electricity prices. The analysis reveals significant market power in the German electricity market, mainly exhibited during peak periods. Producer surplus is also increased significantly due to strategic behavior.
ISSN:0022-1821
1467-6451
DOI:10.1111/j.1467-6451.2006.00297.x