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The smart grid technology enables an increasing level of responsiveness on the demand side, facilitating demand serving entities—large consumers and retailers—to procure their electricity needs under the best conditions. Such entities generally exhibit a proactive role in the pool, seeking to procure their energy needs at minimum cost. Within this framework, we propose a mathematical model to help large consumers to derive bidding strategies to alter pool prices to their own benefit. Representing the uncertainty involved, we develop a stochastic complementarity model to derive bidding curves, and show the advantages of such bidding scheme with respect to non-strategic ones. [ABSTRACT FROM PUBLISHER]

This paper proposes an approach for analyzing the impacts of large-scale wind power integration on electricity market equilibria. A pool-based oligopolistic electricity market is considered including a day-ahead market and a number of real-time markets. Wind power is considered within the generation portfolio of the strategic producers, and the uncertainty of wind power production is modeled through a set of plausible scenarios. The strategic behavior of each producer is modeled through a stochastic bilevel model. The resulting nonlinear equilibrium problem with equilibrium constraints (EPEC) is linearized and then solved. Numerical results for a test case with increasing levels of the wind power penetration is provided. [ABSTRACT FROM AUTHOR]

This paper analyzes numerically the approach reported in the companion paper for identifying generation investment equilibria in an electricity market where the producers behave strategically. To this end, a two-node illustrative example and a large-scale case study based on the IEEE reliability test system (RTS) are examined and the results obtained are reported and discussed. [ABSTRACT FROM PUBLISHER]

The first of this two-paper series proposes a methodology to characterize generation investment equilibria in a pool-based network-constrained electricity market, where the producers behave strategically. To this end, the investment problem of each strategic producer is represented using a bilevel model, whose upper-level problem determines the optimal investment and the supply offering curves to maximize its profit, and whose several lower-level problems represent different market clearing scenarios. This model is transformed into a mathematical program with equilibrium constraint (MPEC) through replacing the lower-level problems by their optimality conditions. The joint consideration of all producer MPECs, one per producer, constitutes an equilibrium problem with equilibrium constraints (EPEC). To identify the solutions of this EPEC, each MPEC problem is replaced by its Karush-Kuhn-Tucker (KKT) conditions, which are in turn linearized. The resulting mixed-integer linear system of equalities and inequalities allows determining the EPEC equilibria through an auxiliary MILP problem. [ABSTRACT FROM PUBLISHER]

This paper provides a methodology to assist a strategic producer in making informed decisions on generation investment. A single target year is considered with demand variations modeled through blocks. The strategic behavior of the producer is represented through a bilevel model: the upper-level considers both investment decisions and strategic production actions and the lower-level corresponds to market clearing. Prices are obtained as dual variables of power balance equations. Rival uncertainties (on offering and investment) are characterized through scenarios. The resulting model is a large-scale mixed-integer LP problem solvable using currently available branch-and-cut techniques. Results pertaining to an illustrative example and a case study are reported and discussed. [ABSTRACT FROM PUBLISHER]