TY - JOUR
T1 - The TC-PSI indicator for forecasting the potential for market power in wholesale electricity markets
AU - Hesamzadeh, Mohammad R.
AU - Biggar, Darryl R.
AU - Hosseinzadeh, Nasser
PY - 2011/10
Y1 - 2011/10
N2 - Wholesale electricity market regulators have long sought a simple, reliable, transparent indicator of the likely impact of wholesale market developments on the exercise of market power. Conventional indicators, such as the Pivotal Supplier Indicator (PSI) and the Residual Supply Index (RSI) cannot be extended to apply to meshed transmission networks, especially when generating companies hold a portfolio of generating units at different locations on the network. This paper proposes a generalisation of these standard measures termed the "Transmission-Constrained Pivotal Supplier Indicator (TC-PSI)". The TC-PSI of a generating company is defined as the maximum must-run generation for any subset of generating plant while allowing for strategic operation of other plant in the portfolio. We illustrate the use of the TC-PSI using a five-node model of the Australian NEM.
AB - Wholesale electricity market regulators have long sought a simple, reliable, transparent indicator of the likely impact of wholesale market developments on the exercise of market power. Conventional indicators, such as the Pivotal Supplier Indicator (PSI) and the Residual Supply Index (RSI) cannot be extended to apply to meshed transmission networks, especially when generating companies hold a portfolio of generating units at different locations on the network. This paper proposes a generalisation of these standard measures termed the "Transmission-Constrained Pivotal Supplier Indicator (TC-PSI)". The TC-PSI of a generating company is defined as the maximum must-run generation for any subset of generating plant while allowing for strategic operation of other plant in the portfolio. We illustrate the use of the TC-PSI using a five-node model of the Australian NEM.
KW - Market power
KW - Merger analysis
KW - Pivotal supplier indicator
UR - http://www.scopus.com/inward/record.url?scp=80052740148&partnerID=8YFLogxK
UR - http://www.scopus.com/inward/citedby.url?scp=80052740148&partnerID=8YFLogxK
U2 - 10.1016/j.enpol.2011.06.061
DO - 10.1016/j.enpol.2011.06.061
M3 - Article
AN - SCOPUS:80052740148
SN - 0301-4215
VL - 39
SP - 5988
EP - 5998
JO - Energy Policy
JF - Energy Policy
IS - 10
ER -