• Department
  • Overview
  • News and Events
  • Job Openings and Candidates
  • Conferences and Seminars
  • Contact
  • Map
  • Facilities

• Academic Programs
  • Graduate
  • Undergraduate
  • Course Information

• People
  • Faculty
  • Professional and Scientific
  • Merit
  • Graduate Students
  • Roster

• Research
  • Publications
  • Publication Databases
  • Journals
  • CARD
  • Associated Centers

• Outreach and Extension
  • Agricultural Programs
  • Community Programs
  • Associated Centers

Publications

Publication Details

Separation and Volatility of Locational Marginal Prices in Restructured Wholesale Power Markets

Author(s):   Hongyan Li, Junjie Sun, Leigh S. Tesfatsion

Series:  ISU Economics Working Paper #09009, June 9, 2009

Abstract:
This study uses an agent-based test bed ("AMES") to investigate separation and volatility of locational marginal prices (LMPs) in an ISO-managed restructured wholesale power market operating over an AC transmission grid. Particular attention is focused on the dynamic and cross-sectional response of LMPs to systematic changes in demand-bid price sensitivities and supply-offer price cap levels under varied learning specifications for the generation companies. Also explored is the extent to which the supply offers of the marginal (price-determining) generation companies induce correlations among neighboring LMPs.

Related work can be accessed at:
http://www.econ.iastate.edu/tesfatsi/AMESMarketHome.htm

JEL Classification:  B4, C0, C6, D4, D43, L1, L13, L5, Q4

Keywords:  Restructured wholesale power markets, agent-based modeling, locational marginal prices (LMPs), LMP separation, LMP volatility, multi-agent learning, demand-bid price sensitivity, supply-offer price caps, AMES Wholesale Power Market Test Bed

Download Full Text