Bidding analysis in joint energy and spinning reserve markets based on pay-as-bid pricing

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Bidding analysis in joint energy and spinning reserve markets based on pay-as-bid pricing

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Owing to the interaction between energy and spinning reserve markets, designing proper bid functions and offering optimal prices to these markets is economically a challenging task from generation companies (GenCos) point of view, especially in the pay-as-bid pricing mechanism. A previously presented only-energy bidding method is generalised in order to model and solve a multimarket bidding problem. Considering a joint probability distribution function for energy and spinning reserve prices, the bidding problem is formulated and solved as a classic optimisation problem. The results show that the contribution of GenCos in each market strongly depends on their production costs, GenCo's risk-aversion degree and the mean values of market prices.

Inspec keywords: probability; power markets

Other keywords: only-energy bidding method; spinning reserve markets; bidding analysis; generation companies; probability distribution function; energy markets; GenCos; pay-as-bid pricing; multimarket bidding

Subjects: Other topics in statistics; Power system management, operation and economics

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