Two-settlement electricity markets with price caps and Cournot generation firms

  title={Two-settlement electricity markets with price caps and Cournot generation firms},
  author={Jian Yao and Shmuel S. Oren and Ilan Adler},
  journal={Eur. J. Oper. Res.},
Abstract We compare two alternative mechanisms for capping prices in two-settlement electricity markets. With sufficient lead time, forward market prices are implicitly capped by competitive pressure of potential entry that will occur when forward prices rise above some backstop price. Another more direct approach is to cap spot prices through a regulatory intervention. In this paper we explore the implications of these two alternative mechanisms in a two-settlement Cournot equilibrium… Expand
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