We present a model of generation and network investment in a competitive electricity system. The model focuses on the duality of long- and short-term locational signals introduced in the European Regulation 1228/2003 for enhancing cross border trade of electricity among Member States. The model...

This paper analyzes the properties of three capacity games in an oligopolistic market with Cournot players. In the first game, capacity and the operation of that capacity is determined simultaneously. This is the classic open-loop Cournot game. In the second game capacity is decided in the first...

Abstract: In competitive electricity markets, markets designs based on power exchanges where supply bidding (barring demand-side bidding) is at the sole short run marginal cost may not guarantee resource adequacy. As alternative ways to remedy the resource adequacy problem, we focus on three...

Abstract: We analyze a two-stage game of strategic firms facing uncertain demand and exerting market power in decentralized electricity markets. These firms choose their generation capacities at the first stage while anticipating a perfectly competitive future electricity spot market outcome at...

We consider the effects of penetration of heat storage for space heating on the balance of payments. Although electric heating has low thermodynamic efficiency, it may be economically attractive because of the use of cheap fuels. Two operating modes are considered for controlling the heat...