961 research outputs found
Managing unilateral market power in electricity
This paper first describes those features of the electricity supply industry that make a prospective market monitoring process essential to a well-functioning wholesale market. Some of these features are shared with the securities industry, although the technology of electricity production and delivery make a reliable transmission network a necessary condition for an efficient wholesale market. These features of the electricity supply industry also make antitrust or competition law alone an inadequate foundation for an electricity market monitoring process. This paper provides examples of both the successes and failures of market monitoring from several international markets. More than 10 years of experience with the electricity industry restructuring process has shown that market failures are more likely and substantially more harmful to consumers than other market failures because of how electricity is produced and delivered and the crucial role it plays in the modern economy. Wholesale market meltdowns of varying magnitudes and durations have occurred in electricity markets around the world, and many of them could have been prevented if a prospective market monitoring process backed by the prevailing regulatory authority had been in place at the start of the market.Access to Markets,Markets and Market Access,Environmental Economics&Policies,Energy Markets,Economic Theory&Research
Unilateral Market Power in Wholesale Electricity Markets
Elektrizitätswirtschaft, Großhandel, Marktführer, Regulierung, Electric utility industry, Wholesale trade, Market leader, Regulation
Lessons from international experience with electricity market monitoring
The author first describes those features of the electricity supply industry that make a prospective market monitoring process essential to a well-functioning wholesale market. Some of these features are shared with the securities industry, although the technology of electricity production and delivery make a reliable transmission network a necessary condition for an efficient wholesale market. These features of the electricity supply industry also make antitrust or competition law alone an inadequate foundation for an electricity market monitoring process. The author provides examples of both the successes and failures of market monitoring from several international markets. More than 10 years of experience with the electricity industry restructuring process has shown that market failures are more likely and substantially more harmful to consumers than other market failures because of how electricity is produced and delivered and the crucial role it plays in the modern economy. Wholesale market meltdowns of varying magnitudes and durations have occurred in electricity markets around the world, and many of them could have been prevented if a prospective market monitoring process backed by the prevailing regulatory authority had been in place at the start of the market.Access to Markets,Markets and Market Access,Environmental Economics&Policies,ClimateChange,Health Economics&Finance
Transversely Hessian foliations and information geometry
A family of probability distributions parametrized by an open domain
in defines the Fisher information matrix on this domain which
is positive semi-definite. In information geometry the standard assumption has
been that the Fisher information matrix tensor is positive definite defining in
this way a Riemannian metric on . If we replace the "positive
definite" assumption by the existence of a suitable torsion-free connection, a
foliation with a transversely Hessian structure appears naturally. In the paper
we develop the study of transversely Hessian foliations in view of applications
in information geometry
The Impact of Market Rules and Market Structure on the Price Determination Process in the England and Wales Electricity Market
This paper argues that the market rules governing the operation of the England and Wales electricity market in combination with the structure of this market presents the two major generators National Power and PowerGen with opportunities to earn revenues substantially in excess of their costs of production for short periods of time. Generators competing to serve this market have two strategic weapons at their disposal: (1) the price bid for each generation set and (2) the capacity of each generation set made available to supply the market each half-hour period during the day. We argue that because of the rules governing the price determination process in this market, by the strategic use of capacity availability declarations, when conditions exogenous to the behavior of the two major generators favor it, these two generators are able to obtain prices for their output substantially in excess of their marginal costs of generation. The paper establishes these points in the following manner. First, we provide a description of the market structure and rules governing the operation of the England and Wales electricity market, emphasizing those aspects that are important to the success of the strategy we believe the two generators use to exercise market power. We then summarize the time series properties of the price of electricity emerging from this market structure and price-setting process. By analyzing four fiscal years of actual market prices, quantities and generator bids into the market, we provide various pieces of evidence in favor of the strategic use of the market rules by the two major participants. The paper closes with a discussion of the lessons that the England and Wales experience can provide for the design of competitive power markets in the US, particularly California, and other countries.
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