Working Paper Number
WP #09009, June 2009 revised March 2010; Old working paper #13075
This study uses an agent-based test bed ("AMES") to investigate separation and volatility of locational marginal prices (LMPs) in an ISO-managed restructured wholesale power market operating over an AC transmission grid. Particular attention is focused on the dynamic and cross-sectional response of LMPs to systematic changes in demand-bid price sensitivities and supply-offer price cap levels under varied learning specifications for the generation companies. Also explored is the extent to which the supply offers of the marginal (price-determining) generation companies induce correlations among neighboring LMPs. Related work can be accessed at: http://www.econ.iastate.edu/tesfatsi/AMESMarketHome.htm
C6, D4, D6, L1, L3, L94, Q4
Latest revision: March 2010 (Original version: June 2009)
Li, Hongyan; Sun, Junjie; and Tesfatsion, Leigh, "Separation and volatility of locational marginal prices in restructured wholesale power markets" (2010). Economics Working Papers (2002–2016). 138.