Title: How Unit-Commitment Decisions Impact Generator Behavior in Wholesale Electricity Markets
Abstract: We study the incentive properties of the two primary approaches to incorporating unit-commitment decisions in wholesale electricity markets. One approach is centralized unit commitment, wherein generating firms provide complex multi-part offers that specify their non-convex fixed and variable operating costs. The second approach is self-commitment, whereby firms determine unit-commitment decisions for their generating units individually and submit simple offers for the provision of energy. We find that the profit of the profit-maximizing firm does not differ significantly between the two market designs but that system costs can be higher under a self-committed design.
Biography: Ramteen is a professor in Department of Engineering and Public Policy and Department of Electrical and Computer Engineering, director of Carnegie Mellon Electricity Industry Center, and a faculty affiliate of Wilton E. Scott Institute for Energy Innovation at Carnegie Mellon University and an adjunct professor in Department of Integrated Systems Engineering at The Ohio State University. His research focuses on the techno-economics of decarbonizing energy systems. He works also in energy policy and electricity-market design, especially as they pertain to energy decarbonization. He is an IEEE Fellow and served three two-year terms on Electricity Advisory Committee, a federal advisory committee to the U.S. energy secretary, and chaired its Energy Storage (Technologies) Subcommittee.
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