Impact Analysis on Non-smooth Strategic Bidding Dynamics with Linear Supply Function

Nash equilibrium and related theory have been used in the description of strategic bidding solutions for players competing in a centralized electricity market, and the existence of multiple/single market equilibria has been found and analyzed with specific system constraints for the market optimization in recent years. In this paper, the impact of line capacity constraints on the strategic bidding is focused on in light of linear supply function model in centralized electricity markets. Dynamic analysis for this non-smooth bidding model with respect to the change of the market equilibrium is given in order to help the generators to make bidding regulation.