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An adaptive pricing mechanism framework for post-auction in the local electricity markets integrating a higher share of renewables

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  • Oprea, Simona-Vasilica
  • Bâra, Adela

Abstract

Typically, after the market clearing, some participants remain unmatched due to price discrepancies. As a result, they are left with the option to buy electricity at the higher Time-of-Use (ToU) rates or sell at the lower Feed-in-Tariff (FiT) rates. In this paper, we explore and compare 5 basic pricing mechanisms and 5 more complex mechanisms, including a modified Vickrey-Clarke-Groves, Nash bargaining solution, cooperative game theory methods like the Shapley value, constrained optimization using Lagrange multipliers and dynamic mechanisms with Reinforcement Learning (RL), to facilitate continued trading on Local Electricity Markets (LEM) and integrate more renewables. First, we propose an Iterative Proportional Adjusting (IPA) method based on bid-ask spreads. Second, to develop an adaptive pricing post-auction mechanism that leverages both simple and complex methods, we propose a framework that dynamically selects the most appropriate pricing strategy based on market conditions, participant behavior and desired outcomes.

Suggested Citation

  • Oprea, Simona-Vasilica & Bâra, Adela, 2026. "An adaptive pricing mechanism framework for post-auction in the local electricity markets integrating a higher share of renewables," Renewable Energy, Elsevier, vol. 256(PB).
    • Handle: RePEc:eee:renene:v:256:y:2026:i:pb:s0960148125017203
    DOI: 10.1016/j.renene.2025.124056
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    References listed on IDEAS

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