Cover: Comparison of values of a spot market for electricity

Comparison of values of a spot market for electricity

Published 1984

by Francis Labrune

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This paper is concerned with a market for electricity that has been successfully operating in Florida since 1978--the Florida Energy Broker. The Broker provides an hourly spot market for energy traded at a wholesale level between utilities with bilateral contracts. The paper compares the distribution of savings resulting from the Broker policy and two alternative policies: one is defined as the Shapley value applied to the Broker market considered as a cooperative game with possibilities of coalitions, another results from the application of the market clearing price which is the core of the previous game. Section II is a general description of the Broker. Section III is a computation of the Broker value for an example generated from available data for a given hourly spot market. Section IV applies the Shapley value to the Florida Energy Broker market and describes the Monte Carlo simulation method used to estimate this value. The corresponding PL/1 routine is listed in the appendix. Section V is a comparison between the different values.

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