ISO Net Surplus Extraction in Restructured Wholesale Power Markets
Tesfatsion, Leigh S.
This study uses an agent-based test bed to systematically explore the net surplus (congestion rents) accruing to non-profit independent system operators (ISOs) in restructured wholesale power markets with grid congestion managed by locational marginal pricing. A key finding is that ISO net surplus can be extremely large, particularly in circumstances in which price sensitivity of demand is low and generation companies learn to tacitly collude on strategic supply offers resulting in higher costs. A practical implication is that ``monitoring of the monitors" is desirable because locational marginal pricing does not align ISO financial incentives with ISO fiduciary responsibilities for efficient market operation. Related work can be found at: http://www.econ.iastate.edu/tesfatsi/AMESMarketHome.htm
Restructured wholesale power markets, ISO net surplus (congestion rents), multi-agent learning, demand-bid price sensitivity, AMES Wholesale Power Market Test Bed
In order to set up a list of libraries that you have access to,
you must first login
or sign up.
Then set up a personal list of libraries from your profile page by
clicking on your user name at the top right of any screen.