Physical clearing mechanisms in power industry

This paper studies the performance of several different physical clearing mechanisms in the electricity market. The study is done using the simulation tool, Marketecture, developed at the Los Alamos National Laboratory. Two cities, Portland and Chicago, are used for simulating the physical clearing algorithms. The algorithms were chosen according to their ability to serve as a proxy for some of the well known policies. Our results show that, based on the economic measures chosen, both cities perform very similarly under the different physical clearing mechanisms.