Study of impacts of physical contracts and financial contracts on bidding strategies of GENCOs

Xiaoling Chen; Y. He; Y. H. Song; Yosuke Nakanishi; Chikashi Nakanishi; Satoru Takahashi; Yoshinori Sekine

doi:10.1016/j.ijepes.2004.06.001

Study of impacts of physical contracts and financial contracts on bidding strategies of GENCOs

Xiaoling Chen, Y. He, Y. H. Song^*, Yosuke Nakanishi, Chikashi Nakanishi, Satoru Takahashi, Yoshinori Sekine

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

17 Citations (Scopus)

Abstract

This paper studies the impacts of physical contracts and financial contracts on the bidding strategies of GENCOs, including Physical Bilateral Contracts, Contracts for Difference (CfDs), Call Options and Put Options under discriminatory pricing mechanism. The integrated bidding decision model is applied, which has three main modules - probabilistic local marginal price simulator, market-oriented unit commitment model and multi-criteria decision system. The numerical results show that the GENCO will choose different bidding strategies if it holds different types of contract. The results also suggest that CfDs have the best performance for risk alleviation.

Original language	English
Pages (from-to)	715-723
Number of pages	9
Journal	International Journal of Electrical Power and Energy System
Volume	26
Issue number	9
DOIs	https://doi.org/10.1016/j.ijepes.2004.06.001
Publication status	Published - 2004 Nov 1
Externally published	Yes

Keywords

Bidding strategy
Contract
Electricity markets
Risk management

ASJC Scopus subject areas

Energy Engineering and Power Technology
Electrical and Electronic Engineering

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10.1016/j.ijepes.2004.06.001

Cite this

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title = "Study of impacts of physical contracts and financial contracts on bidding strategies of GENCOs",

abstract = "This paper studies the impacts of physical contracts and financial contracts on the bidding strategies of GENCOs, including Physical Bilateral Contracts, Contracts for Difference (CfDs), Call Options and Put Options under discriminatory pricing mechanism. The integrated bidding decision model is applied, which has three main modules - probabilistic local marginal price simulator, market-oriented unit commitment model and multi-criteria decision system. The numerical results show that the GENCO will choose different bidding strategies if it holds different types of contract. The results also suggest that CfDs have the best performance for risk alleviation.",

keywords = "Bidding strategy, Contract, Electricity markets, Risk management",

author = "Xiaoling Chen and Y. He and Song, {Y. H.} and Yosuke Nakanishi and Chikashi Nakanishi and Satoru Takahashi and Yoshinori Sekine",

year = "2004",

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doi = "10.1016/j.ijepes.2004.06.001",

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T1 - Study of impacts of physical contracts and financial contracts on bidding strategies of GENCOs

AU - Chen, Xiaoling

AU - He, Y.

AU - Song, Y. H.

AU - Nakanishi, Yosuke

AU - Nakanishi, Chikashi

AU - Takahashi, Satoru

AU - Sekine, Yoshinori

PY - 2004/11/1

Y1 - 2004/11/1

N2 - This paper studies the impacts of physical contracts and financial contracts on the bidding strategies of GENCOs, including Physical Bilateral Contracts, Contracts for Difference (CfDs), Call Options and Put Options under discriminatory pricing mechanism. The integrated bidding decision model is applied, which has three main modules - probabilistic local marginal price simulator, market-oriented unit commitment model and multi-criteria decision system. The numerical results show that the GENCO will choose different bidding strategies if it holds different types of contract. The results also suggest that CfDs have the best performance for risk alleviation.

AB - This paper studies the impacts of physical contracts and financial contracts on the bidding strategies of GENCOs, including Physical Bilateral Contracts, Contracts for Difference (CfDs), Call Options and Put Options under discriminatory pricing mechanism. The integrated bidding decision model is applied, which has three main modules - probabilistic local marginal price simulator, market-oriented unit commitment model and multi-criteria decision system. The numerical results show that the GENCO will choose different bidding strategies if it holds different types of contract. The results also suggest that CfDs have the best performance for risk alleviation.

KW - Bidding strategy

KW - Contract

KW - Electricity markets

KW - Risk management

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M3 - Article

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JO - International Journal of Electrical Power and Energy Systems

JF - International Journal of Electrical Power and Energy Systems

IS - 9

ER -

Study of impacts of physical contracts and financial contracts on bidding strategies of GENCOs

Abstract

Keywords

ASJC Scopus subject areas

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