Simulating Oligopolistic Pool-Based Electricity Markets: A Multiperiod Approach

This paper simulates a pool-based electricity market and identifies equilibrium patterns. A multiperiod framework that requires the use of continuous and binary variables is considered. Producers can be either price-takers or price-makers, although price-makers and their behavior characterize the market. The elasticity of the loads is modeled through piecewise constant pricedemand curves. The market operator uses a detailed networkconstrained market-clearing auction that results in hourly marketclearing prices. The behavior of the market participants and the market itself are characterized through a repetitive simulation procedure. The tool presented in this paper is particularly useful for the market regulator that may use it to monitor the market and to identify the exercise of market power by producers. Results from a realistic case study are presented and discussed.