A Unifying Market Power Measure for Deregulated Transmission-Constrained Electricity Markets

Subhonmesh Bose, Chenye Wu, Yunjian Xu, Adam Wierman, Hamed Mohsenian-Rad

Research output: Contribution to journalArticle

Abstract

Market power assessment is a prime concern when designing a deregulated electricity market. In this paper, we propose a new functional market power measure, termed transmission constrained network flow (TCNF), that unifies three large classes of transmission constrained structural market power indices in the literature: residual supply based, network flow based, and minimal generation based. Furthermore, it is suitable for demand-response and renewable integration and hence more amenable to identifying market power in the future smart grid. The measure is defined abstractly, and allows incorporation of power flow equations in multiple ways; we investigate the current market operations using a DC approximation and further explore the possibility of including detailed AC power flow models through semidefinite relaxation, and interior-point algorithms from Matpower. Finally, we provide extensive simulations on IEEE benchmark systems and highlight the complex interaction of engineering constraints with market power assessment.

Original languageEnglish (US)
Article number6935037
Pages (from-to)2338-2348
Number of pages11
JournalIEEE Transactions on Power Systems
Volume30
Issue number5
DOIs
StatePublished - Sep 1 2015
Externally publishedYes

Keywords

  • Electricity markets
  • Market power

ASJC Scopus subject areas

  • Energy Engineering and Power Technology
  • Electrical and Electronic Engineering

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