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Competitive Behavior of Hydroelectric Power Plants under Uncertainty in Spot Market

Author

Listed:
  • Marcelle Caroline Thimotheo de Brito

    (PPE—Energy Planning Program, Federal University of Rio de Janeiro, Rio de Janeiro 21941-901, Brazil)

  • Amaro O. Pereira Junior

    (PPE—Energy Planning Program, Federal University of Rio de Janeiro, Rio de Janeiro 21941-901, Brazil)

  • Mario Veiga Ferraz Pereira

    (PSR Energy Consulting and Analytics, Rio de Janeiro 22250-040, Brazil)

  • Julio César Cahuano Simba

    (PSR Energy Consulting and Analytics, Rio de Janeiro 22250-040, Brazil)

  • Sergio Granville

    (PSR Energy Consulting and Analytics, Rio de Janeiro 22250-040, Brazil)

Abstract

This article aims to analyze agents’ behavior in a competitive hydrothermal energy market. The idea is to investigate how much the day-to-day behavior of the market can be different from the predictions presented by cost-based models because of the risk perception of each agent (hydroelectric energy producer, in this case) as a participant of the market. The main contribution is in determining the impact on the agents’ revenue in the short-term market due to the variation in the amount of energy generated and the market price, which other methodologies may not be able to capture. For this reason, a case study was made using daily simulations in a given month, observing the strategy and bids of eight hydroelectric agents for a central market operator emulated by an energy price offer simulator called SOPEE. The study reflected qualitative and quantitative examples of how the risk perception and the behavior of each agent can influence market behavior due to the variation in their perceptions of the parameters that form the energy price.

Suggested Citation

  • Marcelle Caroline Thimotheo de Brito & Amaro O. Pereira Junior & Mario Veiga Ferraz Pereira & Julio César Cahuano Simba & Sergio Granville, 2022. "Competitive Behavior of Hydroelectric Power Plants under Uncertainty in Spot Market," Energies, MDPI, vol. 15(19), pages 1-22, October.
    • Handle: RePEc:gam:jeners:v:15:y:2022:i:19:p:7336-:d:934555
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