An empirical study of applied game theory: transmission constrained Cournot behavior

Author

Cunningham, Lance B. ; Baldick, Ross ; Baughman, Martin L.

Author_Institution

Dept. of Electr. & Comput. Eng., Texas Univ., Austin, TX, USA

Volume

17

Issue

1

fYear

2002

fDate

2/1/2002 12:00:00 AM

Firstpage

166

Lastpage

172

Abstract

Restructured energy markets present opportunities for the exercise of market power, meaning market players can potentially maintain prices in excess of competitive prices. In this paper, we investigate Cournot equilibrium in a simple example network. We analyze three market players in a transmission-constrained system and consider nonconstant marginal cost. Several scenarios are evaluated that show a pure strategy equilibrium can break down even when a transmission constraint exceeds the value of the unconstrained Cournot equilibrium line flow

Keywords

costing; electricity supply industry; game theory; load flow; power transmission; Cournot equilibrium; competitive prices; game theory; market players; market power; nonconstant marginal cost; power pricing; restructured energy markets; strategy equilibrium; transmission constrained Cournot behavior; transmission constraint; transmission-constrained system; unconstrained Cournot equilibrium line flow; Constraint theory; Costs; Electricity supply industry; Environmental economics; Forward contracts; Game theory; Power industry; Power system economics; Power system modeling; Pricing;

fLanguage

English

Journal_Title

Power Systems, IEEE Transactions on

Publisher

ieee

ISSN

0885-8950

Type

jour

DOI

10.1109/59.982209

Filename

982209