Abstract
Wholesale electricity markets use different market designs to handle congestion in the transmission network. We compare nodal, zonal and discriminatory pricing in general networks with transmission constraints and loop flows. We conclude that in large games with many producers and certain information, the three market designs result in the same efficient dispatch. However, zonal pricing with counter-trading results in additional payments to producers in export-constrained nodes, which leads to inefficient investments in the long-run.
| Original language | English |
|---|---|
| Pages (from-to) | 145-166 |
| Number of pages | 22 |
| Journal | Energy Journal |
| Volume | 36 |
| Issue number | 2 |
| DOIs | |
| Publication status | Published - 2015 |
Bibliographical note
Publisher Copyright:Copyright © 2015 by the IAEE. All rights reserved.
Other keywords
- Congestion management
- Counter-trading
- Discriminatory pricing
- Large game
- Nodal pricing
- Transmission network
- Wholesale electricity market
- Zonal pricing