Title: A Unifying Approach to Assessing Market Power in Deregulated Electricity Market

Speaker: Chenye Wu (Tsinghua University)

Time: 14:30-15:30, 18 June 2013

Venue: Lecture Room, 3rd Floor, Building #5, State Key Laboratory of Computer Science, Institute of Software, Chinese Academy of Sciences

Abstract:

Electricity market is unique in that if a liberalized electricity market is not well designed, it may substantially erode many of its potential benefits, e.g., as in the California electricity crisis in the years of 2000 and 2001. In particular, a deregulated electricity market must be designed such that market players cannot gain market power.

It is shown that a generator may not gain market power if the regional independent system operator (ISO) can still meet the total load demand even after excluding that generator from the market. Otherwise, the generator in question becomes crucial to meet the demand, which will give that generator the advantage to arbitrarily manipulating the prices. While assessing market power based on the above definition is not difficult in an electricity pool. Market power analysis can become significantly more challenging if the network topology and the capacities of the transmission lines are taken into consideration. Therefore, we address the problem of identifying the potential for market power in presence of transmission constraints. In particular, we present a novel unifying approach to assess market power that can carry the combined advantages of several existing market power assessment indices in the literature.

Biography:

Dr. Chenye Wu received his PhD in Computer Science and Bachelor degree in Electronic Engineering both from Tsinghua University in 2013 and 2009, respectively. He was advised by Prof. Andrew Yao in the Institute for Interdisciplinary Information Sciences at Tsinghua University. After his graduation, he will join Carnegie Mellon University as a postdoctoral researcher. He was a visiting scholar at various universities: the Chinese University of Hong Kong, Texas Tech University, Missouri University of Science and Technology, Carnegie Mellon University, and California Institute of Technology. Currently, he is working on the design, optimization, distributed control and game-theoretic analysis of smart power systems and electricity market.