Behavioural market power indices in a transmission-constrained electricity market

This study proposes new behavioural indices of market power (MP) in order to analyse bidding behaviour of units in a transmission-constrained electricity market. The indices calculate actual MP exercised by generators of the market. The proposed indices check whether a generator exerts an influence on the wholesale price and it is able to change the price at studied trading period. If the generator is capable of raising the wholesale price, the proposed indices calculate exact values for the generator's withholding. The first proposed index measures financial withholding exercised by marginal generators and the second one calculates physical withholding of players taking into account the impact of withdrawal of output on the wholesale price. The proposed indices are quantified for modified PJM 5-bus system and compared with the former behavioural indices to verify their accuracy. In addition, modified IEEE 30-bus system is considered to clarify the transparent applications of the indices for more complicated system.