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Long-Run Optimal Pricing in Electricity Markets with Non-Convex Costs

  • Conleigh Byers
  • Gabriela Hug
    • Categories Applications - OR and Management Sciences, Integer Programming Tags , ,

    Determining optimal prices in non-convex markets remains an unsolved challenge. Non-convex costs are critical in electricity markets, as startup costs and minimum operating levels yield a non-convex optimal value function over demand levels. While past research largely focuses on the performance of different non-convex pricing frameworks in the short-run, we determine long-run adapted resource mixes … Read more

    Efficient Prices under Uncertainty and Non-Convexity

  • Brent Eldridge
  • Bernard Knueven
  • Jacob Mays
    • Categories Applications - OR and Management Sciences Tags , ,

    Operators of organized wholesale electricity markets attempt to form prices in such a way that the private incentives of market participants are consistent with a socially optimal commitment and dispatch schedule. In the U.S. context, several competing price formation schemes have been proposed to address the non-convex production cost functions characteristic of most generation technologies. … Read more