Artículo de revista
Monopolistic competition in electricity networks with resistance losses
Fecha
2010Registro en:
Econ Theory (2010) 44:101–121
DOI 10.1007/s00199-009-0460-2
Autor
Escobar, Juan F.
Jofré Cáceres, René
Institución
Resumen
We consider a pool type electricity market in which generators bid prices
in a sealed bid form and are dispatched by an independent system operator (ISO). In our
model, demand is inelastic and the ISO allocates production to minimize the system
costs while considering the transmission constraints. In a departure from received literature,
the model incorporates explicit description of the network details. The analysis
shows that losses along transmission lines render the market imperfectly competitive.
Indeed, competition among generators is qualitatively similar to the interaction among
firms in amonopolistic competition setting.Alower bound formarket prices is derived
and it is shown that the costumers’ cost of oligopolistic pricing is strictly positive. At
a methodological level, we generalize standard oligopoly theory tools.