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The Efficiency of Multi-Unit Electricity Auctions

Author

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  • Wedad Elmaghraby
  • Shmuel S. Oren

Abstract

Using a complete information game-theoretic model, we analyze the performance of different electricity auction structures in attaining efficiency (i. e., least-cost dispatch). We find that an auction structure where generators are allowed to bid for load "slices" outperforms an auction structure where generators submit bids for different hours in the day.

Suggested Citation

  • Wedad Elmaghraby & Shmuel S. Oren, 1999. "The Efficiency of Multi-Unit Electricity Auctions," The Energy Journal, , vol. 20(4), pages 89-116, October.
    • Handle: RePEc:sae:enejou:v:20:y:1999:i:4:p:89-116
    DOI: 10.5547/ISSN0195-6574-EJ-Vol20-No4-4
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    References listed on IDEAS

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    1. Paul Milgrom, 2000. "Putting Auction Theory to Work: The Simultaneous Ascending Auction," Journal of Political Economy, University of Chicago Press, vol. 108(2), pages 245-272, April.
    2. Johnson, Raymond B. & Oren, Shmuel S. & Svoboda, Alva J., 1997. "Equity and efficiency of unit commitment in competitive electricity markets," Utilities Policy, Elsevier, vol. 6(1), pages 9-19, March.
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