Your browser does not support JavaScript!
http://iet.metastore.ingenta.com
1887

access icon free Market power assessment through modelling of effective anti-competitive behaviour of participants

© The Institution of Engineering and Technology
Received 30/05/2019, Accepted 13/07/2020, Revised 14/06/2020, Published 13/08/2020

Market power is an anti-competitive issue in the electricity markets, the identification and monitoring of which require using comprehensive and accurate indices. In this study, two new behavioural indices are introduced for the effective and accurate monitoring of market power. The suggested indices determine the actual level of market power in the transmission-constrained electricity markets by analysing the bidding behaviour of participants. The proposed indices necessarily consider the success of the participant's anti-competitive behaviour in a price increase on the basis for computation. First, the effective physical withholding index is presented, which can determine the amount of physical withholding that has led to the acceptance of a more expensive block. The effective financial distortion rate index is then proposed, which can specify the degree of financial deviation of the participants resulting from the successful exercise of each participant's withholding (financial–physical) strategy. Investigation of the results obtained from a three-bus test system and the IEEE 57-bus test system verifies the effective and accurate performance of the proposed indices in assessing the market power.

Inspec keywords: tendering; power markets

Other keywords: effective anti-competitive behaviour; effective physical withholding index; IEEE 30-bus test system; behavioural indices; bidding behaviour; transmission-constrained electricity markets; three-bus test system; effective financial distortion rate index; market power assessment

Subjects: Public utilities; Contractual issues; Power system management, operation and economics

References

    1. 1)
      • 7. Sheffrin, A.: ‘Predicting market power using the residual supply index’, Presented at the FERC Market Monitoring Workshop, December 2002.
    2. 2)
      • 20. Hakam, D.F.: ‘Mitigating the risk of market power abuse in electricity sector restructuring: evidence from Indonesia’, Util. Policy, 2019, 56, pp. 181–191.
    3. 3)
      • 22. Landes, W., Posner, R.: ‘Market power in antitrust cases’, J. Reprints Antitrust L. Econ., 1997, 27, p. 493.
    4. 4)
      • 1. Kelman, R., Barroso, L.A.N., Pereira, M.V.F.: ‘Market power assessment and mitigation in hydrothermal systems’, IEEE Trans. Power Syst., 2001, 16, (3), pp. 354–359.
    5. 5)
      • 25. Jian-Wei, K., Hao, Z., Bai-Xue, H., et al: ‘Bidding surveillance indices and their application’. 2005 IEEE/PES Transmission and Distribution Conf. and Exhibition: Asia and Pacific, Dalian, People's Republic of China, 2005, pp. 1–6.
    6. 6)
      • 26. Khajeh, H., Akbari Foroud, A.: ‘Behavioural market power indices in a transmission-constrained electricity market’, IET Gener. Transm. Distrib., 2017, 11, (18), pp. 4608–4616.
    7. 7)
      • 3. Rahimi, A.F., Sheffrin, A.Y.: ‘Effective market monitoring in deregulated electricity markets’, IEEE Trans. Power Syst., 2003, 18, pp. 486–493.
    8. 8)
      • 19. Salarkheili, S., Nazar, M.S.: ‘Capacity withholding assessment in the presence of integrated generation and transmission maintenance scheduling’, IET Gener. Transm. Distrib., 2017, 11, (16), pp. 3903–3911.
    9. 9)
      • 16. Tanaka, M., Chen, Y.: ‘Market power in renewable portfolio standards’, Energy Econ., 2013, 39, pp. 187–196.
    10. 10)
      • 11. Hesamzadeh, M.R., Biggar, D.R., Hosseinzadeh, N.: ‘The TC-PSI indicator for forecasting the potential for market power in wholesale electricity markets’, Energy. Policy., 2011, 39, pp. 5988–5998.
    11. 11)
      • 4. Karthikeyan, S.P., Raglend, I.J., Kothari, D.P.: ‘A review on market power in deregulated electricity market’, IEEE Trans. Power Syst., 2013, 48, pp. 139–147.
    12. 12)
      • 6. Chernenko, N.: ‘Market power issues in the reformed Russian electricity supply industry’, Energy Econ., 2015, 50, pp. 315–323.
    13. 13)
      • 8. Gan, D., Bourcier, D.V.: ‘Locational market power screening and congestion management: experience and suggestion’, IEEE Trans. Power Syst., 2002, 17, (1), pp. 180–185.
    14. 14)
      • 27. Christie, R.: ‘UW power system test case archive’, https://egriddata.org/group/uw-power-systems-test-case-archive.
    15. 15)
      • 10. Yen-Yu, L., Baldick, R., Jin, H.: ‘Firm-based measurements of market power in transmission-constrained electricity markets’, IEEE Trans. Power Syst., 2011, 26, pp. 1962–1970.
    16. 16)
      • 12. Hesamzadeh, M.R., Zami-ur Rahman, A.K.M., Amelin, M.: ‘The probabilistic TC-PSI for studying market power’. 2011 IEEE PES Innovative Smart Grid Technologies Asia (ISGT), Perth, WA, Australia, 2011, pp. 1–7.
    17. 17)
      • 21. Ye, Y., Papadaskalopoulos, D., Strbac, G.: ‘Investigating the ability of demand shifting to mitigate electricity producers’ market power’, IEEE Trans. Power Syst., 2017, 33, pp. 3800–3811.
    18. 18)
      • 2. Shahidehpour, M., Alomoush, M.: ‘Restructured electrical power systems: operation: trading, and volatility’, 2017.
    19. 19)
      • 24. Sheffrin, A.: ‘Empirical evidence of strategic bidding in the California ISO real-time market’, in ‘Electricity pricing in transition’ (Springer, US, 2002), pp. 267–281.
    20. 20)
      • 9. Wang, P., Xiao, Y., Ding, Y.: ‘Nodal market power assessment in electricity markets’, IEEE Trans. Power Syst., 2004, 19, (3), pp. 1373–1379.
    21. 21)
      • 13. Soofiabadi, A., Akbari Foroud, A.: ‘Nodal market power detection under locational marginal pricing’, Iran. J. Electr. Electron. Eng., 2014, 10, (1), pp. 45–54.
    22. 22)
      • 5. Newbery, D., Green, R., Neuhoff, K., et al: ‘A review of the monitoring of market power’, Report prepared at the request of ETSO, www.etso-net.org, 2004 systems, 2006.
    23. 23)
      • 23. Genc, T.S.: ‘Measuring demand responses to wholesale electricity prices using market power indices’, Energy Econ., 2016, 56, pp. 247–260.
    24. 24)
      • 17. Salarkheili, S., Akbari Foroud, A.: ‘Market power assessment in electricity markets: supply function equilibrium-based model’, Int. Trans. Electr. Energy Syst., 2013, 23, (4), pp. 553–569.
    25. 25)
      • 18. Salarkheili, S., Nazar, M.S.: ‘Capacity withholding analysis in transmission-constrained electricity markets’, IET Gener. Transm. Distrib., 2016, 10, (2), pp. 487–495.
    26. 26)
      • 15. Shafie-Khah, M., Moghaddam, M.P., Sheikh-El-Eslami, M.K.: ‘Ex-ante evaluation and optimal mitigation of market power in electricity markets including renewable energy resources’, IET Gener. Transm. Distrib., 2016, 10, (8), pp. 1842–1852.
    27. 27)
      • 14. Bose, S., Wu, C., Xu, Y., et al: ‘A unifying market power measure for deregulated transmission constrained electricity markets’, IEEE Trans. Power Syst., 2015, 30, (5), pp. 2338–2348.
http://iet.metastore.ingenta.com/content/journals/10.1049/iet-gtd.2019.0834
Loading

Related content

content/journals/10.1049/iet-gtd.2019.0834
pub_keyword,iet_inspecKeyword,pub_concept
6
6
Loading
Print this page
This is a required field
Please enter a valid email address