This paper investigates the incentives market participants have in the German electricity balancing mechanism. Strategic over- and undersupply positions are the result of existing stochastic arbitrage opportunities between the spot market and the balancing mechanism. This strategic behavior can...

This paper provides the technical background, describes the market design and its development as well as summarizes the market results of the German system reserve capacity market and the balancing energy mechanism, which are the key tools for required balancing the of the electricity system.

This paper models the interdependencies between markets for secondary reserve capacity and spot electricity to derive the pricing of reserves under equilibrium conditions. Starting with the indifference condition between offering in both markets, the reservation price is derived from the...

This paper investigates the incentives market participants have in the German electricity balancing mechanism. Strategic over- and under-supply positions are the result of existing stochastic arbitrage opportunities between the spot market and the balancing mechanism. This strategic behavior can...

This paper provides the technical background, describes the market design and its development as well as summarizes the market results of the German system reserve capacity market and the balancing energy mechanism, which are the key tools for required balancing the of the electricity system

This paper provides the technical background, describes the market design and its development as well as summarizes the market results of the German system reserve capacity market and the balancing energy mechanism, which are the key tools for required balancing the of the electricity system.

This paper investigates the incentives market participants have in the German electricity balancing mechanism. Strategic over- and undersupply positions are the result of existing stochastic arbitrage opportunities between the spot market and the balancing mechanism. This strategic behavior can...