This paper presents a market design for Colombia’s forward energy market, which is scheduled to began in 2008. The forward energy market is an organized market to procure energy for electricity customers on a forward basis. It includes both the regulated market (residential and other small customers) and the nonregulated market (large customers). Currently, regulated customers represent 68% of the total electricity demand and nonregulated customers represent the remaining 32%. The proposed design is novel in that it integrates both the regulated and nonregulated customers into a single organized market. Although the regulated and nonregulated energy products remain distinct, their integration into a single market facilitates arbitrage between the products, improves liquidity, and reduces transaction costs. Both regulated and nonregulated customers benefit from this unified approach. This paper presents all elements of the market design: the product design (see also Cramton 2007), the auction design, and the transition to the new market.
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Paper provided by University of Maryland, Department of Economics - Peter Cramton in its series Papers of Peter Cramton with number
07fem.
Length: 64 pages Date of creation: 2007 Date of revision:
2007 Publication status: Published in Working Paper, University of Maryland, August 2007 Handle: RePEc:pcc:pccumd:07fem
Contact details of provider: Postal: Economics Department, University of Maryland, College Park, MD 20742-7211 Phone: (202) 318-0520 Fax: (202) 318-0520 Web page: http://www.cramton.umd.edu
For technical questions regarding this item, or to correct its listing, contact: (Peter Cramton).
Find related papers by JEL classification: D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Peter Cramton, 1998.
"Ascending Auctions,"
Papers of Peter Cramton
98eer, University of Maryland, Department of Economics - Peter Cramton, revised 28 Jul 1998.
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