Decision Support For Demand Response Triggers: Methodology Development and Proof of Concept Demonstration

Project Final Report prepared for CIEE and California Energy Commissio

A Review of ISO New England's Proposed Market Rules

This report reviews the proposed rules for restructured wholesale electricity markets in New England. We review the market rules, both individually and collectively, and identify potential problems that might limit the efficiency of these markets. We examine alternatives and identify the key tradeoffs among alternative designs. We believe that the wholesale electricity market in New England can begin on December 1, 1998. However, improvements are needed for long-run success. We have identified four major recommendations: 1. Switch to a multi-settlement system. 2. Introduce demand-side bidding. 3. Adopt location-based transmission congestion pricing, especially for the import/export interfaces. 4. Fix the pricing of the ten minute spinning reserves.Auctions; Multiple Object Auctions; Electricity Auctions

Regulating the Electricity System Operator: Lessons for Great Britain from around the world

This study explores the international experience with independent system operators (ISOs) with respect to the incentives that system operators face to operate the electricity network efficiently (from the point of view of society). We look for lessons that we can learn from this experience for the future regulation of the Great Britain (GB) System Operator (National Grid Electricity Transmission). We examine seven ISOs from the USA, where the model seems to be successful but with some cost issues within the system operator itself. We also examine system operators from Australia (AEMO), Chile (SIC/SING) and Peru (COES). Our findings are supported by a short survey that was sent directly to our contacts in the system operators from our sample of ISOs. Against a background of rising distributed renewable generation on the electricity system, we discuss the international experience of ISOs with respect to their incentives to: maximise social welfare; manage the increasing amount of renewables and new participants; manage their overall actions for customers; engage in stakeholder participation and transparency

Australia's energy options: policy choice not economic inevitability

Executive summary A reliable and affordable supply of energy is a fundamental component to a vibrant economy. As a major source of commodities, including significant known reserves of low carbon emission energy sources, Australia is well positioned to supply the world’s future energy needs. In order for that to occur, Australia needs to examine all its energy options. The Government released a Draft Energy White paper in November 2011. CEDA considers this an opportunity that the Government should not miss in ensuring that Australia not only develops its energy resources for national economic gain but also to guarantee access to reasonably priced energy for Australian consumers. CEDA determined it would contribute to this significant debate by undertaking a year-long research project that examined Australia’s future energy options. As part of this research project CEDA published three policy perspectives that addressed Australia’s nuclear, renewables and efficiency and unconventional energy options. Recommendations in each of these perspectives were made with the specific aim of providing policy-makers with evidence-based research on the various energy sources either currently available or being actively explored and researched, often funded through the public purse. Fundamental governance decisions underpinned by strong economic policy arguments were at the centre of these recommendations. This final research report canvasses one of the more significant current debates associated with the availability of energy – the Australian electricity market. It puts forward a series of recommendations designed to enhance this element of the energy sector’s efficiency, security and effectiveness by placing consumers at the centre of the energy market and a reform agenda is proposed. Related identifier: ISBN 0 85801 284

The Liberalisation of European Energy Markets: The Use of Competition Law as a Regulatory Tool

The objective of this thesis is to examine the approach adopted by the European Commission in recently regulated energy markets. Antitrust investigations indicate that the European Commission increasingly tends to implement competition law, in particular through commitment decisions, in order to create a quasi-ex ante regulatory effect in the markets. The main conclusion of this thesis is that a lack of legal certainty and insufficient clarification of the law originating from this approach might have detrimental impacts on a single and competitive energy market design in Europe. This thesis consists of three substantial chapters in addition to the introductory and final conclusion chapters. The first chapter analyses long-term supply contracts concluded in the wholesale markets from both an economic and a legal perspective. The economic analysis of the contracts shows that the functioning of European energy markets remains ambiguous. The European Commission thus seems to adopt a strategy to balance spot market trading with long-term supply contracts and vertical integration through antitrust investigations. The second chapter aims at examining the tendency of European Commission to assess the foreclosure effects of a preferential use of cross-border energy transmission networks within the new liberalised energy markets. While a pro-entry bias approach of the European Commission is observed in the case law, it is difficult to find recognition by the Commission as well as secondary EU law of the likely pro-competitive effects of long-term cross-border transmission network reservations resulting from the associated long-term cross-border supply contracts. Besides, it can be observed from the case law that the European Commission and the European Courts tend to approve the preferential use of networks as long as the right holder engages in a major investment in these networks. As a consequence, the methodology adopted by the European Commission for the antitrust analyses of priority access rights to cross-border infrastructure might fail to correspond with legal predictability and economic accuracy. The aim of the third chapter is to show the tendency of the European Commission to finalise antitrust investigations through a public settlement procedure, which seems to be a convenient tool for the facilitation of market regulation through antitrust enforcement. The increased number of commitment decisions in the energy markets raises a concern regarding the possible detrimental effects of this trend. With the consideration of the importance of legal certainty in the regulated markets in terms of market building and social welfare, the chapter proposes a hypothetical framework guideline including certain measures which may increase the efficiency and sustainability of public settlement procedures and also improve legal certainty in the energy markets

Competition Law and Economic Regulation

Shaping markets through competition and economic regulation is at the heart of addressing the development challenges facing countries in southern Africa. The contributors to 'Competition Law And Economic Regulation: Addressing Market Power In Southern Africa' critically assess the efficacy of the competition and economic regulation frameworks, including the impact of a number of the regional competition authorities in a range of sectors throughout southern Africa. Featuring academics as well as practitioners in the field, the book addresses issues common to southern African countries, where markets are small and concentrated, with particularly high barriers to entry, and where the resources to enforce legislation against anti-competitive conduct are limited. What is needed, the contributors argue, is an understanding of competition and regional integration as part of an inclusive growth agenda for Africa. By examining competition and regulation in a single framework, and viewing this within the southern African experience, this volume adds new perspectives to the global competition literature. It is an essential reference tool and will be of great interest to policymakers and regulators, as well as the rapidly growing ecosystem of legal practitioners and economists engaged in the field

Why We Need to Stick with Uniform-Price Auctions in Electricity Markets

Wholesale electricity markets are commonly organized around a spot energy market. Buyers and suppliers submit bids and offers for each hour and the market is cleared at the price that balances supply and demand. Buyers with bids above the clearing price pay that price, and suppliers with offers below the clearing price are paid that same price. This uniform-price auction, which occurs both daily and throughout the day, is complemented by forward energy markets. In practice, between 80 and 95 percent of wholesale electricity is traded in forward energy markets, often a month, or a year, and sometimes many years ahead of the spot market. However, because forward prices reflect spot prices, in the long run, the spot market determines the total cost of energy. It also plays a critical role in the least-cost scheduling and dispatch of resources, and provides an essential price signal both for short-run performance and long-run investment incentives. Arguments that the uniform-price auction yields electricity prices that are systematically too high are incorrect. However, insufficiently hedged spot prices will result in energy costs that fluctuate above and below the long-run average more than regulated prices and more than is socially optimal. Tampering with the spot price would cause inefficiency and raise long-term costs. The proper way to dampen the impact of spot price fluctuations is with long-term hedging. Although re-regulation can provide a hedge, there are less costly approaches.Auctions, electricity auctions, uniform-price auctions

Optimization of factorial portfolio of trade enterprises in the conditions of the non-payment crisis

The economic mechanism for factoring management of trade enterprises was improved by applying a tool for refinancing receivables involving third parties, which will contribute to the effective management of fundraising processes from the standpoint of the income approach. The instruments for the implementation of the economic mechanism of factoring management of commercial enterprises, consisting of five blocks were improved (analysis of commercial enterprise debtors’ solvency in order to transfer them to factoring services; analysis of accounts receivable and assessment of its real value; planning of cash flows from factoring operations; factoring implementation assessment; monitoring and control of the repayment of receivables in the process of factoring services), that allows substantiating practical recommendations for improving the level of factoring management. Based on the concept of a portfolio of investments, a factoring model was built to optimize the debtors of the enterprise

Competition in Electricity Spot Markets: Economic Theory and International Experience

auctions, electricity markets