Market power modelling in electricity market: A critical review

Dzikri Hakam

Research output: Contribution to journalArticle

2 Citations (Scopus)
41 Downloads (Pure)

Abstract

This paper presents a critical review of market power modelling in the electricity market. This research provides a coherent guideline for policy market to determine suitable modelling for market power in the electricity market. This research also includes market power index application in competition policy enforcement. An ideal market power index is one which provides the most straightforward number to measure the market power exercise. However, a more sophisticated approach is needed to mitigate market power since traditional indexes have limitations in representing the complexity of the power system. Cournot modelling has the main weakness in large-scale power system modelling with transmission constraint. However, the Cournot model continues to develop as a tool to analyse player behaviour due to the analytical connectivity between a real power market and microeconomic engineering theory, e.g. DC load flow, reserve margin, transmission constraint, forward contract, demand elasticity, and RSI.
Original languageEnglish
Pages (from-to)347-356
Number of pages10
JournalInternational Journal of Energy Economics and Policy
Volume8
Issue number5
Publication statusPublished - 2018

Fingerprint

Elasticity
Modeling
Market power
Electricity market
Power markets
Power system
Power indices
Enforcement
System modeling
Margin
Demand elasticity
Cournot model
Cournot
Connectivity
Power market
Competition policy
Exercise
Forward contracts
Microeconomics

Keywords

  • Competition policy
  • Electricity market
  • Market power

Cite this

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Market power modelling in electricity market : A critical review. / Hakam, Dzikri.

In: International Journal of Energy Economics and Policy, Vol. 8, No. 5, 2018, p. 347-356.

Research output: Contribution to journalArticle

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