Power System Economics: Designing Markets for Electricity

An Introduction to the Fundamental Economics of Power Market Design and Analysis
Power System Economics is the first systematic presentation of power–market design principles from economic theory to market architecture. The approach is pragmatic, and the discussion illustrates economic and engineering fundamentals with simple examples. The volume breaks new ground in its analysis of price spikes, market–based unit commitment, and the prediction of market power.
Power System Economics includes five parts. Part 1 introduces key economic, engineering, and market design concepts. Part 2 explains how short–run reliability policies determine long–run average installed capacity and reliability. Part 3 examines classic designs for day–ahead and real–time markets. Part 4 covers market power, and Part 5 covers the effect of networks on prices. Topics include:
∗ How marginal–cost prices cover fixed costs
∗ Fundamentals of auction design
∗ The value of lost load (VOLL) as a price cap: theory versus practice
∗ Price limits, price spikes, investment, and reliability
∗ Standard market designs, including PJM
∗ Power pools versus power exchanges
∗ Market power fallacies and the HHI
∗ Losses pricing and congestion pricing

Spis treści:
List of Results and Fallacies.
Preface.
Acronyms and Abbreviations.
Symbols.
Part 1: Power Market Fundamentals.
Prologue.
Why Deregulate?
What to Deregulate.
Pricing Power, Energy, and Capacity.
Power Supply and Demand.
What Is Competition?
Marginal Cost in a Power Market.
Market Structure.
Market Architecture.
Designing and Testing Market Rules.
Part 2: Reliability, Price Spikes and Investment.
Reliability and Investment Policy.
Price Spikes Recover Fixed Costs.
Reliability and Generation.
Limiting the Price Spikes.
Value–of–Lo st–Load Pricing.
Operating–Reserve Pricing.
Market Dynamics and the Profit Function.
Requirements for Installed Capacity.
Inter–System Competition for Reliability.
Unsolved Problems.
Part 3: Market Architecture.
Introduction.
The Two–Settlement System.
Day–Ahead Market Designs.
Ancillary Services.
The Day–Ahead Market in Theory.
The Real–Time Market in Theory.
The Day–Ahead Market in Practice.
The Real–Time Market in Practice.
The New Unit–Commitment Problem.
The Market for Operating Reserves.
Part 4: Market Power.
Defining Market Power.
Exercising Market Power.
Modeling Market Power.
Designing to Reduce Market Power.
Predicting Market Power.
Monitoring Market Power.
Part 5: Locational Pricing.
Power Transmission and Losses.
Physical Transmission Limits.
Congestion Pricing Fundamentals.
Congestion Pricing Methods.
Congestion Pricing Fallacies.
Refunds and Taxes.
Pricing Losses on Lines.
Pricing Losses at Nodes.
Transmission Rights.
Glossary.
References.
Index.

Nota biograficzna:
STEVEN STOFT has a BS in engineering mathematics and a PhD in economics from the University of California at Berkeley, and over ten years of experience in power market analysis and design. He has held positions at FERC, the University of California′s Energy Institute, and the Lawrence Berkeley National Laboratory. He is currently a consultant to the Pennsylvania–New Jersey–Maryland ISO (PJM), California′s Electricity Oversight Board, the U.S. Department of Energy, and an independent power producer.

Okładka tylna:
An Introduction to the Fundamental Economics of Power Market Design and Analysis
Power System Economics is the first systematic presentation of power–market design principles from economic theory to market architecture. The a pproach is pragmatic, and the discussion illustrates economic and engineering fundamentals with simple examples. The volume breaks new ground in its analysis of price spikes, market–based unit commitment, and the prediction of market power.
Power System Economics includes five parts. Part 1 introduces key economic, engineering, and market design concepts. Part 2 explains how short–run reliability policies determine long–run average installed capacity and reliability. Part 3 examines classic designs for day–ahead and real–time markets. Part 4 covers market power, and Part 5 covers the effect of networks on prices. Topics include:
∗ How marginal–cost prices cover fixed costs
∗ Fundamentals of auction design
∗ The value of lost load (VOLL) as a price cap: theory versus practice
∗ Price limits, price spikes, investment, and reliability
∗ Standard market designs, including PJM
∗ Power pools versus power exchanges
∗ Market power fallacies and the HHI
∗ Losses pricing and congestion pricing