A sensitivity approach to detection of local market power potential

Bernard C. Lesieutre, Katherine M. Rogers, Thomas J. Overbye, Alex R. Borden

Research output: Contribution to journalArticlepeer-review


Market power gives certain market participants the ability to manipulate the market to their advantage when their product is not substitutable by competitors. Identification of generators which have the potential for market power either individually or within a small group is performed using sensitivity information from the linear programming optimal power flow (LP OPF). The impact of network constraints on admissible price perturbations are used to group generators that have the potential to exhibit local market power. Specific price perturbation vectors are found that highlight a constraint-induced locational advantage for these suppliers. In practice, this is most commonly observed in "load pockets," for which ISO policies mitigate market power.

Original languageEnglish (US)
Article number5711706
Pages (from-to)1980-1988
Number of pages9
JournalIEEE Transactions on Power Systems
Issue number4
StatePublished - Nov 2011


  • Eigenvectors
  • electricity markets
  • linear sensitivity analysis
  • market power potential

ASJC Scopus subject areas

  • Energy Engineering and Power Technology
  • Electrical and Electronic Engineering


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