3 1. Describe the bidding process by which the electricity generation sector provides electricity to pooling and balancing authorities. Additionally, show this process by building an electricity supply curve. a. What antitrust and regulation concerns are present at the wholesale stage of the electricity market? b. Describe a market design that reduces market manipulation in wholesale electricity markets. Show that the Nash equilibrium under this market design will result in generators bidding their true marginal cost of production. c. Describe a vertically integrated industry as it pertains to the electricity sector. d. Describe non-linear (two part) pricing as it pertains to retail electricity sales. What is the purpose of this pricing system?
3
1. Describe the bidding process by which the electricity generation sector provides electricity to pooling and balancing authorities. Additionally, show this process by building an electricity supply curve.
a. What antitrust and regulation concerns are present at the wholesale stage of the electricity market?
b. Describe a market design that reduces market manipulation in wholesale electricity markets. Show that the Nash equilibrium under this market design will result in generators bidding their true marginal cost of production.
c. Describe a vertically integrated industry as it pertains to the electricity sector.
d. Describe non-linear (two part) pricing as it pertains to retail electricity sales. What is the
purpose of this pricing system?
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