Strategic bidding in vertically integrated power markets with an application to the Italian electricity auctions

Bosco, Bruno; Parisio, Lucia; Pelagatti, Matteo

doi:10.1016/j.eneco.2011.11.005

Cited by 32 publications

(29 citation statements)

References 28 publications

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“…The number of market participants on MGP was 143 in 2012, 154 in 2013, and 208 in 2014; on MSD was 25 in 2012, 27 in 2013 and 32 in 2014; finally, the participation on MB was of 24 operators in 2012 and 2013, and 28 in 2014. For a detailed investigation on market power and bidding strategies on MGP see [1] and [2]. During our sample period the Italian MGP registered a downward trend of the PUN.…”

Section: The Structure Of the Italian Electricity Wholesale Marketmentioning

confidence: 99%

“…Specifically, we consider the Italian market, IPEX, where the intermittent generation has substantially increased over the last two years. Indeed, we study the dynamics of prices from 2012 to end of 2014 looking at the Italian physical zones 1 where most of renewable generation is placed; namely in North, where hydro is predominant, South and Sicily, where most of wind and photovoltaic generation is placed. After selecting the most interesting hours, hence looking at intra-daily profiles for load, wind and solar generation, we determine the relationship between spot and regulation prices, providing implications on the premia for readiness occurring into Italian zones.…”

Section: Introductionmentioning

confidence: 99%

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RES effects in Italian wholesale electricity market

Gianfreda

Parisio

2015

2015 12th International Conference on the European Energy Market (EEM)

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Abstract-We empirically analyze the relationship between wholesale electricity day-ahead and regulation prices in the presence of high share of RES generation. Our results only partly confirm those obtained by Skytte (1999) for the Oslo area. In the Italian case, regulating power prices follow spot prices and, in some cases, they are two or three times larger than the latter ones. We generally observe that the amount of regulation does not affect regulating power prices, even if they actually behave differently to up-and down-regulation. In addition, we find empirical evidence of very high premia for readiness with different behaviors according to Italian zones.

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Section: The Structure Of the Italian Electricity Wholesale Marketmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

RES effects in Italian wholesale electricity market

Gianfreda

Parisio

2015

2015 12th International Conference on the European Energy Market (EEM)

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“…Nevertheless, the Italian electricity market, as reported by Bigerna et al (2015), recorded transmission congestions and its structure is far from being perfectly competitive: suppliers are able to exercise market power bidding prices higher than their marginal costs (see Bosco et al, 2012).…”

Section: Introductionmentioning

confidence: 99%

Competitive Equilibrium in the Italian Wholesale Electricity Market

et al. 2015

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“…The supply function equilibrium model has been extensively used in the empirical literature for analyzing electricity markets. Many studies including Rudkevich, Duckworth, and Rosen [3] and Baldick, Grant, and Kahn [4] compare estimates of market power with that predicted by the theory using marginal cost estimates, while others, including Wolak [5] and Bosco, Parisio, and Pelagatti [6], retrieve marginal cost functions and price-cost margins from bid data assuming optimal bidding.…”

Section: Introductionmentioning

confidence: 99%

Electricity Pricing and Market Power: Evidence from the Hungarian Balancing Energy Market

Paizs¹

2015

Engineering and Industry

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This paper presents an empirical analysis of the relationship between market structure and energy prices in the Hungarian balancing energy market. In Hungary, balancing energy is procured in two phases: firstly a reserve capacity auction is organized to select the generation capacities that are kept in reserve and available to the TSO in a specific day, and then a balancing energy auction is used to determine the dispatch order of reserved capacities in the hours of that day. Under this arrangement the winners of the reserve auctions and thereby the bidders in the balancing energy auctions change significantly form one day to the next. I exploit this variation in the bidding environment in the balancing energy auctions to identify the effect of market structure on prices. My empirical analysis focuses on the downward balancing market where generators submit bids for purchasing energy from the TSO. Consistently with the theoretical results in Fabra, von der Fehr, and Harbord [1], I find that the average purchasing price is positively affected by the number of bidders and the symmetry in capacity share distribution.

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Strategic bidding in vertically integrated power markets with an application to the Italian electricity auctions

Cited by 32 publications

References 28 publications

RES effects in Italian wholesale electricity market

RES effects in Italian wholesale electricity market

Competitive Equilibrium in the Italian Wholesale Electricity Market

Electricity Pricing and Market Power: Evidence from the Hungarian Balancing Energy Market

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