Endogenous Price Zones and Investment Incentives in Electricity Markets: An Application of Multilevel Optimization with Graph Partitioning

In the course of the energy transition, load and supply centers are growing apart in electricity markets worldwide, rendering regional price signals even more important to provide adequate locational investment incentives. This paper focuses on electricity markets that operate under a zonal pricing market design. For a fixed number of zones, we endogenously derive the … Read more