uniqueness of market equilibrium on a network a peak load pricing approach abstract in this paper we establish conditions under which uniqueness of market equilibrium is obtained in a setup where prior to trading of electricity transmission capacities between different market regions are fixed in our setup firms facing fluctuating demand decide on the size and location of production facilities they make production decisions constrained by the invested capacities taking into account that market prices partially reflect scarce transmission capacities between the different market zones for this type of peak load pricing model on a network we state general conditions for existence and uniqueness of the market equilibrium and provide a characterization of equilibrium investment and production the presented analysis covers the cases of perfect competition and monopoly the case of strategic firms is approximated by a conjectural variations approach our result is a prerequisite for analyzing regulatory policy options with computational multilevel equilibrium models since uniqueness of the equilibrium at lower levels is of key importance when solving these models thus our paper contributes to an evolving strand of literature that analyzes regulatory policy based on computational multilevel equilibrium models and aims at taking into account individual objectives of various agents among them not only generators and customers but also e g the regulator deciding on network expansion

alternative models of restructured electricity systems part 1 no market power different equilibrium concepts have been proposed by various authors schweppe et al hogan et al chao and peck wu et al to analyse competitive electricity systems we establish correspondences between these different models through a single framework and provide additional interpretations of these equilibrium concepts this unifying conceptual view also provides a computationally feasible approach to simulate the market it also opens the way to the modeling of some imperfect markets

on the long run effects of market splitting why more price zones might decrease welfare in liberalized electricity markets we observe different approaches to congestion management while nodal pricing is implemented in canada and some markets in the united states european markets are split up into a limited number of price zones with uniform prices in order to at least partially realize the benefits of regional price differentiation zonal boundaries often coincide with national borders but some countries are also split into multiple zones in this paper we shed light on possible negative welfare effects of market splitting that arise in a model where investment incentives in new generation capacity are taken into account if zones are misspecified we show that standard approaches to configure price zones on the basis of projected nodal price differences or congested transmission capacity may fail to suggest reasonable zone specifications also an adjustment of available transfer capacities atcs between zones or a switch to flow based market splitting does not ensure positive welfare effects our analysis suggests that a careful and detailed evaluation of the system is needed to ensure a reasonable zone configuration

cross cultural variations in climate for autonomy stress and organizational productivity relationships a comparison of chinese and uk manufacturing organizations cross cultural researchers have questioned the extent to which european american management practices can be transported to major markets in asia such as the people s republic of china applying employee involvement theory we examined the relationships between climate for autonomy work demands climate employee stress and organizational productivity in a cross national study of 51 uk and 104 chinese manufacturing organizations we predicted and found that climate for autonomy was positively and negatively related to stress in the chinese and uk contexts respectively the interaction of climate for autonomy and work demands climate was significant climate for autonomy was positively related to organizational productivity only when work demands climate was low

welfare effects of expansions in equilibrium models of an electricity market with fuel network the welfare of electricity producers and consumers depends on congestion in the transmission grid generation costs that consist mainly of fuel costs and strategic behavior we formulate a game theoretic model of an oligopolistic electricity market where generation costs are derived from a fuel supply network the game consists of a fuel dispatcher that transports fuels at minimum cost to meet generator demands generators that maximize profit in cournot competition and an independent system operator iso that sets nodal prices to balance electricity supply with linear demand functions we prove the existence of an equilibrium if fuel supplies are unlimited the same equilibria hold in a simplified version of the game in which each generator optimizes its fuel acquisition from the network in some very simple examples under different assumptions about the rationality of generators with respect to iso decisions paradoxical effects on total welfare can occur from expanding either electricity transmission capacity or the transportation capacity of low cost fuel we find some instances in which the paradox occurs only under bounded rationality of the generators others where it occurs only if the generators are fully rational and still others where it occurs to different degrees under the two rationality assumptions

clearing the air the costs and consequences of higher cafe standards and increased gasoline taxes abstract concerns about energy security and climate change have sparked legislators interest in reducing gasoline consumption by increasing corporate average fuel economy cafe standards using an empirically rich simulation model and cost estimates for anticipated fuel economy technologies we estimate annual costs of reducing long run gasoline consumption by 10 via a 3 8 miles per gallon increase in the standards and the potential cost savings from allowing manufacturers to buy and sell fuel economy credits maximum gasoline savings would be realized only after all existing vehicles were replaced or 14 years in our model a gasoline tax would produce greater immediate savings by encouraging people to drive less and eventually to choose more fuel efficient vehicles we demonstrate the advantage of a tax by comparing the cost of the higher cafe standards over the first 14 years against the cost of a gasoline tax that would save the same amount of gasoline over that time

influence of formalization on role stress organizational commitment and work alienation of salespersons a cross national comparative study organizations rely on formalization to coordinate the efforts of employees however this practice has been found to have a negative influence on role stress organizational commitment and work alienation of salespersons though the negative influence of formalization in the united states has been known for some time we still cannot predict if similar relationships would should be observed in other countries because the rationale developed to explain these relationships in the united states did not consider the cultural factors that influence them with such knowledge it would become possible to anticipate the nature of the relationship in different cultural environments such an approach to developing cross national models has been often suggested but seldom implemented by emphasizing the role of culture this study generates practical guidelines for both practitioners and theorists

interpreting societal culture value dimensions societal cultural value dimension scholarship can both learn from and inform the family of interrelated approaches to culture research in ib that appear in recent commentaries it can exchange insights about societal values and meaning systems with neo institutional and institutional logics research it can also exchange insights with dual processing cognition theories that are used to understand individuals in an international context by treating societal culture values and institutional characteristics as essential to interpreting personal values and attitudes rather than merging them integrating culture related specialties by exchanging insights can promote the further development of research in each of these societal and individual level fields

co learning patterns as emergent market phenomena an electricity market illustration abstract the definition of emergence remains problematic particularly for systems with purposeful human interactions this study explores the practical import of this concept within a specific market context namely a double auction market for wholesale electric power that operates over a transmission grid with spatially located buyers and sellers each profit seeking seller is a learning agent that attempts to adjust its daily supply offers to its best advantage the sellers are co learners in the sense that their supply offer adjustments are in response to past market outcomes that reflect the past supply offer choices of all sellers attention is focused on the emergence of co learning patterns that is global market patterns that arise and persist over time as a result of seller co learning examples of co learning patterns include correlated seller supply offer behaviors and correlated seller net earnings outcomes heat maps are used to display and interpret co learning pattern findings one key finding is that co learning strongly matters in this auction market environment sellers that behave as gode sunder budget constrained zero intelligence agents randomly selecting their supply offers subject only to a break even constraint tend to realize substantially lower net earnings than sellers that tacitly co learn to correlate their supply offers for market power advantages

differences in managerial values a study of u s hong kong and prc managers in this study of convergence divergence of managerial values four western developed measures machiavellianism locus of control intolerance of ambiguity and dogmatism and the four dimensions of the eastern developed chinese value survey confucian dynamism human heartedness integration and moral discipline were the measures used the findings indicate that often times both culture and the business environment interact to create a unique set of managerial values in a country

bi level game approaches for coordination of generation and transmission expansion planning within a market environment the main purpose of this paper is to develop methodologies for simultaneous generation and transmission expansion planning problem of power networks while investigating interactions between these two important sections in the proposed methodologies a transmission operator to operating under different incentives decides about investment in transmission network while anticipating the outcome of a purely competitive electricity market where several rival generation firms complete with each other to determine operating level of their generators amount of their sales and amount of their investment in generation capacity the proposed methodologies rely on bi level programming models whose upper level model represent the problem of investment in transmission by to and the lower level problems represent market outcomes obtained from clearing the market these bi level models are reduced to mixed integer linear and nonlinear programming using the duality theory and karush kuhn tucker kkt optimality conditions the results of the proposed models are analyzed and compared using two illustrative examples

a three level static milp model for generation and transmission expansion planning we present a three level equilibrium model for the expansion of an electric network the lower level model represents the equilibrium of a pool based market the intermediate level represents the nash equilibrium in generation capacity expansion taking into account the outcomes on the spot market and the upper level model represents the anticipation of transmission expansion planning to the investment in generation capacity and the pool based market equilibrium the demand has been considered as exogenous and locational marginal prices are obtained as endogenous variables of the model the three level model is formulated as a mixed integer linear programming milp problem the model is applied to a realistic power system in chile to illustrate the methodology and proper conclusions are reached

distributional and efficiency impacts of increased us gasoline taxes we examine the impacts of increased us gasoline taxes in a model that links the markets for new used and scrapped vehicles and recognizes the consider able heterogeneity among households and cars household choice parameters derive from an estimation procedure that integrates individual choices for car ownership and miles traveled we find that each cent per gallon increase in the price of gasoline reduces the equilibrium gasoline consumption by about 0 2

strategic investment in merchant transmission the impact of capacity utilization rules abstract in this paper we look at the relative merits of two capacity utilization regimes in the merchant electricity transmission network must offer mo where the entire capacity installed has to be made available for transmission and non must offer nmo where some capacity could be withheld we look at two specific cases i demand for transmission varies across time and ii vertical integration is allowed between investors in transmission network and electricity generators in the case of time varying demand under mo we find that a monopolist may underinvest in transmission when compared to nmo although nmo may lead to more capacity withholding in the case of vertical integration we find that when the market power is with the generators of the exporting node without vertical integration no welfare enhancing merchant investment would occur neither under mo nor nmo further if the generators in the importing node have market power in case vertical integration is allowed mo is better than nmo finally we also argue that the incentive to collude among various transmission network investors is mitigated with mo in place

the manager as mediator of alternative meanings a pilot study from china the usa and u k managers in china the usa and britain were asked to describe the extent to which they used five sources for handling nine managerial events western managers were found to rely more upon their own experience and training while in china rules and procedures were more salient for most events western managers who described themselves as relying on their own experience and training believed that the events had been well handled they reported that events were less well handled to the extent that they referred to their superiors reliance on the superior was associated with role ambiguity among western managers but not in china even though chinese managers relied more upon rules and procedures they too evaluated events more positively when they had relied on their own experience and training the results are discussed in terms of chinese and western cultural values and the prospects for change in managerial practice in china

swing contracts with dynamic reserves for flexible service management the increasing penetration of variable energy resources in modern electric power systems requires additional flexibility in reserve provision to maintain reliable and efficient grid operations however full recognition and appropriate compensation of this flexibility is difficult to ensure within current power market designs due to rigidity in reserve definitions and requirements this paper proposes a new mixed integer linear programming formulation for the optimal clearing of a day ahead market based on swing contracts with dynamically updated regulation reserve zones five bus and 30 bus test cases are used to illustrate the effectiveness of the proposed new market design

pounds that kill the external costs of vehicle weight heavier vehicles are safer for their own occupants but more hazardous for other vehicles simple theory thus suggests that an unregulated vehicle fleet is inefficiently heavy using three separate identification strategies we show that controlling for own vehicle weight being hit by a vehicle that is 1000 pounds heavier generates a 40 50 increase in fatality risk these results imply a total accident related externality that exceeds the estimated social cost of us carbon emissions and is equivalent to a gas tax of 0 97 per gallon 136 billion annually we consider two policies for internalizing this external cost a weight varying mileage tax and a gas tax and find that they are similar for most vehicles the findings suggest that european gas taxes may be much closer to optimal levels than the us gas tax language en

a framework for culture assessment understanding the nature and influences of culture is central to international business such inquiry presupposes knowing that the cultural grouping s of a study is a valid unit of analysis which is critical in that the estimation of culture effects can vary based on the unit definition unfortunately perhaps out of convenience international studies often simply use a country based definition of culture in a desire to facilitate further development in understanding culture effects in this paper we propose a framework by which valid cultural groupings may be assessed

grid integration of intermittent renewable energy sources using price responsive plug in electric vehicles abstract plug in electric vehicles pevs are expected to balance the fluctuation of renewable energy sources res to investigate the contribution of pevs the availability of mobile battery storage and the control mechanism for load management are crucial this study therefore combined the following a stochastic model to determine mobility behavior an optimization model to minimize vehicle charging costs and an agent based electricity market equilibrium model to estimate variable electricity prices the variable electricity prices are calculated based on marginal generation costs hence because of the merit order effect the electricity prices provide incentives to consume electricity when the supply of renewable generation is high depending on the price signals and mobility behavior pevs calculate a cost minimizing charging schedule and therefore balance the fluctuation of res the analysis shows that it is possible to limit the peak load using the applied control mechanism the contribution of pevs to improving the integration of intermittent renewable power generation into the grid depends on the characteristic of the res generation profile for the german 2030 scenario used here the negative residual load was reduced by 15 22 and the additional consumption of negative residual load was between 34 and 52

reconsidering the european regulation of merchant transmission investment in light of the third energy package the role of dominant generators the regulation of merchant transmission investment mti has become an important issue in the eu electricity sector subsequent to the granting of authorizations by european authorities to five merchant projects britned estlink t heeast west cables norger and recently a merchant line connecting italy and austria the creation of a new agency for the cooperation of energy regulators acer at the eu level which has decision making powers on mti therefore presents a unique opportunity to question and re design the current european policy this paper shows that the recent decisions concerning mti may suffer a strong bias against dominant electricity generators while incumbent transmission system operators tsos or new entrant tsos are generally favored by national regulators and the european commission ec this strategy is misguided as it fails to recognize both the new incentives of generators to develop mti and the conflict of interest between the regulated and non regulated activities of incumbent tsos letting dominant generators undertake mti is indeed generally beneficial as long as potential abuses of dominance are mitigated to deter possible anti competitive effects we propose a new and feasible allocation of regulatory powers based on a clear demarcation between the market monitoring powers of acer and the antitrust powers of the ec 2011 elsevier ltd all rights reserved

optimal transmission planning under the mexican new electricity market abstract this paper addresses electricity transmission planning under the new industry and institutional structure of the mexican electricity market which has engaged in a deep reform process after decades of a state owned vertically integrated non competitive closed industry under this new structure characterized by a nodal pricing system and an independent system operator iso we analyze welfare optimal network expansion with two modeling strategies in a first model we propose the use of an incentive price cap mechanism to promote the expansion of mexican networks in a second model we study centrally planned grid expansion in mexico by an iso within a power flow model we carry out comparisons of these models which provide us with hints to evaluate the actual transmission planning process proposed by mexican authorities prodesen we obtain that the prodesen plan appears to be a convergent welfare optimal planning process

real time pricing to assist in load frequency control we study the use of real time prices to assist in the control of frequency and tie line deviations in electric power systems the role of such prices if any would yield the practical limit to the trend in electric power systems of varying prices on ever faster time scales the application of prices in electric power systems to increase the efficient use of resources is an established technique the pricing schemes can be classified by time scales energy adjustment charges vary seasonally or monthly while time of day rates vary two or three times per day the power brokering system of 18 florida utilities operates on an hourly time scale in a spot price market of buyers and sellers of electric power prices adapt to system operation conditions such as changes in system lambda the effect of generation shortages and the effect of line overloads the fastest spot price that has been implemented to date is 30 minutes most implementations involve 1 hour time steps which may be prespecified 24 hours in advance on a five minute time scale is system lambda a shadow price used internally by electric utilities for economic dispatch a key assumption of spot pricing and economic dispatch is that the power system is in quasi steady state i e power system dynamics involving frequency voltage etc are ignored and only kirchoff s laws for network are considered the paper explores pricing at time scales where the quasi steady state assumption is no longer valid

iso net surplus collection and allocation in wholesale power markets under lmp this study uses five bus and 30 bus test cases to explore iso net surplus congestion rent collections and allocations in wholesale power markets with grid congestion managed by locational marginal prices lmps price sensitivity of demand and generator learning capabilities are taken as experimental treatment factors a key finding is that conditions resulting in greater generator capacity withholding hence higher and more volatile lmps also result in greater iso net surplus collections that can be substantial in size a key conclusion is that iso net surplus collections should be used pro actively to mitigate the conditions encouraging generator capacity withholding and hence high and volatile lmps rather than to provide ex post support for lmp payment offsets and lmp volatility risk hedging as is currently the norm

the economics of planning electricity transmission to accommodate renewables using two stage optimisation to evaluate flexibility and the cost of disregarding uncertainty abstract aggressive development of renewable electricity sources will require significant expansions in transmission infrastructure we present a stochastic two stage optimisation model that captures the multistage nature of transmission planning under uncertainty and use it to evaluate interregional grid reinforcements in great britain gb in our model a proactive transmission planner makes investment decisions in two time periods each time followed by a market response uncertainty is represented by economic technology and regulatory scenarios and first stage investments must be made before it is known which scenario will occur the model allows us to identify expected cost minimising first stage investments as well as estimate the value of information the cost of ignoring uncertainty and the value of flexibility our results show that ignoring risk in planning transmission for renewables has quantifiable economic consequences and that considering uncertainty can yield decisions that have lower expected costs than traditional deterministic planning methods in the gb case the value of information and cost of disregarding uncertainty in transmission planning were of the same order of magnitude approximately 100 m in present worth terms further the best plan under a risk neutral decision criterion can differ from the best under risk aversion finally a traditional sensitivity analysis based robustness analysis also yields different results than the stochastic model although the former s expected cost is not much higher

an economic welfare analysis of demand response in the pjm electricity market abstract we analyze the economic properties of the economic demand response dr program in the pjm electricity market in the united states using dr market data pjm s program provided subsidies to customers who reduced load in response to price signals the program incorporated a trigger point at a locational marginal price of 75 mwh at or beyond which payments for load reduction included a subsidy payment particularly during peak hours such a program saves money for the system but the subsidies involved introduce distortions into the market we simulate demand side bidding into the pjm market and compare the social welfare gains with the subsidies paid to price responsive load using load and price data for year 2006 the largest economic effect is wealth transfers from generators to non price responsive loads based on the incentive payment structure that was in effect through the end of 2007 we estimate that the social welfare gains exceed the distortions introduced by the subsidies lowering the trigger point increases the transfer from generators to consumers but may result in the subsidy outweighing the social welfare gains due to load curtailment we estimate that the socially optimal range for the incentive trigger point would be 66 77 mwh

the survival of international new ventures international new ventures invs are a popular mode of entry into foreign markets invs those companies that enter foreign markets at inception often suffer the two liabilities of newness and foreignness which may increase the odds of their failure this paper empirically examines the survival of invs by comparing them with other sequential modes of international operations e g acquisitions data from 275 british firms show that invs have lower unconditional survival probabilities than other modes of foreign market entry our analyses also show that differences in survival probabilities disappear when the firms competitive strategies are considered

market based generation and transmission planning with uncertainties this paper presents a stochastic coordination of generation and transmission expansion planning model in a competitive electricity market the monte carlo simulation method is applied to consider random outages of generating units and transmission lines as well as inaccuracies in the long term load forecasting the scenario reduction technique is introduced for reducing the computational burden of a large number of planning scenarios the proposed model assumes a capacity payment mechanism and a joint energy and transmission market for investors costs recovery the proposed approach simulates the decision making behavior of individual market participants and the iso it is an iterative process for simulating the interactions among gencos transcos and iso the iterative process might be terminated by the iso based on a pre specified stopping criterion the case studies illustrate the applications of proposed stochastic method in a coordinated generation and transmission planning problem when considering uncertainties

where do all the windmills go influence of the institutional setting on the spatial distribution of renewable energy installation abstract promoting renewable energy sources is one policy response to climate change not only is there currently a debate over the best policy instrument it is also discussed whether the renewable energy production should be expanded centralized at locations with the highest production potential or decentralized close to load it is yet not fully understood what influences the spatial distribution of renewable energy installation i assess the effect of subsidy scheme and market design on the spatial distribution of wind energy installations by comparing a feed in tariffs versus market premiums and b uniform versus nodal pricing the analysis is based on theoretical considerations and using a six node test model that reflects the consumption and renewable resource distribution in several countries and regions the institutional setting has great influence on the spatial distribution and resulting system costs with uniform pricing a market premium only leads to a more decentralized expansion of renewable energy production than a tariff when sites share similar wind conditions spatially more distributed expansion of wind power performs better in terms of total costs and share of wind power in final demand when networks are restricted

what is the value of the option to defer an investment in transmission expansion planning an estimation using real options abstract in deregulated markets transmission expansion planning tep is usually performed by a central network planner seeking to maximize social welfare in doing that the network planner commonly follows a traditional project valuation considering a discounted cash flow dcf methodology although incorporating uncertainty and reliability considerations accordingly once the optimal transmission expansion plan is determined the network planner frequently auctions the needed investments obligating the investor to execute the expansion in the fixed inflexible terms defined in the bidding process a key problem is that dcf does not take into account the responses of the planner when uncertainties are resolved because dcf evaluates the project with the information available today in tep managerial flexibility may be valuable because optimal decisions may change over time with the release of new information transmission investors may want to defer or expand according to such information the aim of this article is to estimate the value of adding some flexibility in tep through real options in particular by means of using a real option approach with binomial trees we study the benefits for a social network planner of having the option to defer some transmission investments our results suggest that incorporating flexibility in tep may increase social welfare

a further inquiry into ftr properties abstract william hogan introduced financial transmission rights as a tool to hedge the locational risk inherent in locational marginal prices ftrs are claimed to serve four main purposes 1 provide a hedge for nodal price differences 2 provide revenue sufficiency for contracts for differences 3 distribute the merchandizing surplus an rto accrues in market operations and 4 provide a price signal for transmission and generation developers this paper examines the hedging and redistributional properties of ftrs it argues that ftr allocation has important distributional impacts and related implications for retail rates this observation adds an additional explanation for rate increases in light of decreased production costs due to restructuring this paper also shows that rto practices have important implications for the hedging characteristics of ftrs it further shows via counterexample that even in theory ftrs may not serve as a perfect hedge against congestion charges the paper concludes with a series of recommendations for ftr allocation and the functions that ftrs should serve

transmission and wind power investment this paper jointly considers wind power investment and transmission reinforcement the proposed model is a mathematical program with equilibrium constraints mpec that seeks to identify the optimal wind projects to be developed and the required network reinforcements under the transmission system operator perspective this mpec seeks to minimize consumer payments and is constrained by investment conditions and the equilibria of the market under different operating conditions an array of subsidies is considered to promote independent wind power investment an example and two case studies illustrate the characteristics of the proposed model

conceptions of self and performance related feedback in the u s japan and china effective international management requires knowledge of culturally patterned self concepts and concomitant feedback desires this paper argues that the cultural forces of individualism versus collectivism shape the self concept and by extension individual performance evaluation and feedback seeking we present a comparative study to test the hypotheses that u s respondents desire success feedback whereas japanese and chinese desire feedback show more initiative and perceive more direct workplace feedback than do either japanese or chinese respondents strong support was found for comparisons between the u s and japan but the chinese consistently departed from predictions we interpret these results in terms of recent reforms in the people s republic of china and discuss implications of the study for international management

the economic value of transmission lines and the implications for planning models abstract many connections between economic efficiency regulation the environment and energy markets are evident in the planning for transmission upgrades in an electricity network transmission owners have to make decisions about investing in new assets while facing uncertainty in the generation plans regulatory and environmental constraints and current system endowments in this paper we demonstrate an analytical method for determining the economic value of individual transmission lines in a meshed network by calculating the total welfare effects for the system while many regulators believe that traditional congestion rents provide the correct incentives for investing in transmission upgrades we show that the uncertainty in system conditions breaks down this paradigm the analysis uses an existing security constrained optimal power flow scopf model and a test network to demonstrate how the method can be used to determine the welfare effects of changing the capacity of selected transmission lines the results show that a substantial portion of the economic benefits for an individual line may come from maintaining system reliability when equipment failures occur furthermore these benefits can change dramatically when inherently intermittent sources of renewable generation are added to a network and the changes in benefits are not captured effectively by changes in the expected congestion rents

market based coordination of transmission and generation capacity planning we propose an iso model for coordinating transmission expansion planning with competitive generation capacity planning in electricity markets the purpose of the model is a holistic simulation of generation and transmission capacity expansion in the market environment the solution represents an iterative process for simulating the interactions among gencos transcos and the iso which might be terminated by the iso based on a pre specified stopping criterion the proposed model adopts a joint energy and transmission auction market and a capacity mechanism the joint auction market enables competition to occur among generation and transmission resources the capacity mechanism offers incentives for market participant investments that reflect the locational values of additional capacity transmission capacity expansion decisions are made by merchant transmission lines that recover their capacity investments through transmission marginal pricing and capacity payments transmission network security is reflected in the proposed competitive resource planning model the examples illustrate a coordinated planning of generation and transmission in restructured power systems

social welfare maximization in transmission enhancement considering network congestion transmission enhancement in a competitive electricity market is analyzed in terms of its impact on the social welfare a formulation of social welfare and the utility functions are derived in this research variations of supply and demand during a year are considered in transmission enhancement decisions the proposed social welfare optimization problem is solved to determine the transmission congestion status under the optimal condition of the existing system transmission enhancement options are compared quantitatively to demonstrate their ability to increase social welfare which provides valuable information for long term transmission the proposed method provides a systematic and quantitative tool for social welfare evaluation that is not available in industry today

investment incentives for flexible demand options under different market designs abstract this paper analyzes investment incentives for flexible manufacturing facilities under different market designs we propose a multi stage equilibrium model incorporating endogenous determination of generation capacity investment network expansion and redispatch based on the model introduced by grimm et al 2016 including flexibilization of industrial electricity consumption the model allows to investigate incentives for flexibilization and the impact of flexible industrial electricity consumers on the system an application to the german electricity market reveals that flexible industrial electricity consumption can be profitable for firms if the share of flexible electricity consumers is high price fluctuations are mitigated which lowers the individual cost savings from demand flexibility comparing different market designs positive impacts of flexible electricity demand on the system are observed in both the system optimum and the market equilibrium in scenarios with flexible industrial electricity consumption welfare is considerably higher than in those without this is due to lower electricity costs of industrial consumers but more importantly due to less investment in conventional power generation as well as a reduced transmission network expansion however a comparison of nodal and uniform pricing underlines the importance of regional price signals with respect to an efficient allocation of flexible industrial demand

fuel economy car class mix and safety fuel economy standards change the composition of the vehicle fleet potentially influencing accident fatality risks i estimate the direction and magnitude of this impact introducing a correction for selection on driver behavior a policy application using my new estimates shows that the present distinction between light trucks and cars in fuel economy rules has very negative consequences for overall safety each mpg increment to the standard results in an additional 150 fatalities per year in expectation my correction for selection is pivotal in this finding i then demonstrate a simple alternative regulation that can produce near zero changes in accident fatalities

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 optimal configuration of price zones and available transfer capacities on a network in order to optimally govern investment and production decisions in the long run in a multilevel mixed integer nonlinear model that contains a graph partitioning problem on the first level we determine welfare maximizing price zones and available transfer capacities for a given electricity market and analyze their impact on market outcomes using a generalized benders decomposition approach developed in grimm et al 2019 and a problem tailored scenario clustering for reducing the input data size we are able to solve the model to global optimality even for large instances we apply the approach to the german electricity market as an example to examine the impact of optimal zoning on key performance indicators such as welfare generation mix and locations or electricity prices it turns out that even for a small number of price zones an optimal configuration of zones induces a welfare level that almost approaches the first best

market failures of market coupling and counter trading in europe an illustrative model based discussion the horizontal integration of the energy market and the organization of transmission services remain two open issues in the restructured european electricity sector the coupling of the french belgian and dutch electricity markets the trilateral market in november 2006 was a real success the extension of the system to germany in november 2010 also proceeded smoothly and the intent is to continue with the same market architecture but market coupling is based on a zonal system which has often failed in meshed grids this may cast doubts on what will happen in the future when electricity demand picks up again and wind develops the nodal system has generally been more successful than zonal architectures but its implementation is not currently foreseen in the eu this paper analyzes versions of market coupling that differ by the organization of counter trading while underplayed in current discussions counter trading could become a key element of market coupling as its geographic coverage expands and wind penetrates we simplify matters by assuming away strategic behavior between the energy and counter trading markets and conduct the analysis on a stylized six node example taken from the literature we simulate market coupling for different assumptions of zonal decomposition and coordination of transmission system operators tsos we show that these assumptions matter even in the absence of strategic behavior market coupling can be quite vulnerable to the particular situation on hand countertrading can work well or completely fail and it is not clear beforehand what will prevail our analysis relies on standard economic notions such as social welfare and generalized nash equilibrium but the use of these notions is probably novel the nodal organization is the reference first best scenario different zonal decompositions and degrees of coordination are then studied with respect to this first best solution

use of multicriteria decision analysis methods for energy planning problems most decision making requires the consideration of several conflicting objectives the term multiple criteria decision analysis mcda describes various methods developed for aiding decision makers in reaching better decisions energy planning problems are complex problems with multiple decision makers and multiple criteria therefore these problems are quite suited to the use of mcda a multitude of mcda methods exists these methods can be divided in three main groups value measurement models goal aspiration and reference level models and outranking models methods from all of these groups have been applied to energy planning problems particularly in the evaluation of alternative electricity supply strategies each of the methods has its advantages and drawbacks however we cannot conclude that one method generally is better suited than the others for energy planning problems a good alternative might be to apply more than one method either in combination to make use of the strengths of both methods or in parallel to get a broader decision basis for the decision maker until now studies of mcda in energy planning have most often considered energy networks with only one energy carrier more advanced energy systems with multiple energy carriers have been neglected even though this field ought to be suitable for use of mcda due to its high complexity many decision makers and many conflicting criteria

retail store density and the cost of greenhouse gas emissions the density size and location of stores in a retailer s network influences both the retailer s and the consumers costs with stores few and far between consumers must travel a long distance to shop whereas shopping trips are shorter with a dense network of stores the layout of the retail supply chain is of interest to retailers who have emission reduction targets and urban planners concerned with sprawl are small local shops preferred over large big box retailers a model of the retail supply chain is presented that includes operating costs such as fuel and rent for floor space as well as a cost for environmental externalities associated with carbon emissions a focus on exclusively minimizing operating costs may substantially increase emissions by 67 in one scenario relative to the minimum level of emissions a price on carbon is an ineffective mechanism for reducing emissions the most attractive option is to improve consumer fuel efficiency doubling the fuel efficiency of cars reduces long run emissions by about one third whereas an improvement in truck fuel efficiency has a marginal impact on total emissions this paper was accepted by yossi aviv operations management

impact of the regulatory framework for transmission investments on the cost of renewable energy in the eu abstract under the current regulatory frame in the eu transmission planning is done at the national level to maximize national welfare rather than european welfare in this paper we develop a competitive equilibrium model that calculates the impact of this imperfect regulatory framework on the cost of renewable energy we apply the model to a power system with two interconnected zones and find that the impact is case specific but significant we also find that the negative impact of national transmission planning on the cost of renewable energy is more significant in a state of the world in which member states trade renewable energy but that this negative effect is much smaller than the positive effect of renewable energy trade between member states we conclude that the imperfect regulatory framework for transmission investment is a significant cost for renewable energy in the eu but that it should not stop member states from trading renewable energy

impact of intermittent non conventional renewable generation in the costs of the chilean main power system abstract chile has recently approved a law aiming a target for electricity generation with non conventional renewable energy ncre of 20 by year 2025 it is anticipated that most of this ncre generation will be provided by intermittent energy sources wind and solar photovoltaic pv the economic consequences of intermittent ncre penetration in the chilean central interconnected system sic are assessed the ncre penetration is simulated with a 10 year horizon 2017 2027 considering four scenarios of ncre penetration 10 15 20 and 30 of total generation the authors model the hydro thermal operation of the power system and analyze spot prices total operation costs and capacity factors results show that the average spot price in the sic when having an optimal minimum cost generation mix is 89 7 us mwh as intermittent ncre penetration increases some thermal base load units capacity factors change producing an increase in the generation cost additional transmission capacity is also needed elevating the total cost the average incremental cost of integrating intermittent ncre generation is 65 8 us mwh when increasing ncre penetration from 10 to 30 the effect of fossil fuel price fluctuation is also addressed two policy guidance elements are presented intermittency should be reduced by diversifying the renewable portfolio and penetration costs of intermittent ncre generation have to be incorporated into their investment or operation costs

competitive irrationality in transitional economies are communist managers less irrational why do marketing managers in the transitional economies of eastern europe and china often engage in competitively irrational behavior choosing pricing strategies that damage competitors profits rather than choosing pricing strategies that improve their firm s profits we propose one possible reason the moral vacuum created by the collapse of communist ideology we hypothesize and find that managers who experienced formal communist moral ideological indoctrination are less likely to be competitively irrational than the post communist managers who did not implications are discussed

a general formulation for lmp evaluation the evaluation of locational marginal prices or lmps which constitute the basis of the new generation of market design in the u s is a critical need in the side by side operation of electricity markets and power systems their use in various applications such as congestion management and hedging requires specific lmp components in the computations we provide a general formulation for the evaluation of the lmp components by making explicit use of the important role played by the nodes with generators with free capacity on the other hand the lmps of the nodes without generation or with the generators at their limits are a function of the lmps at the marginal nodes and the impacts of the network constraints including the losses in the network in the formulation we pay special attention to the importance of the assumptions and specifications the so called policy specification in the determination of the components we obtain a very general formulation that brings under a single framework the different decomposition approaches that exist the formulation s comprehensiveness brings numerous insights into the various decompositions provides a platform for their comparative analysis and allows us to understand the direct implications and the role of the policy specified moreover the formulation reveals the limitations of any decomposition into the components due to the underlying structural interdependencies among them which is clearly shown in this paper we provide an example to illustrate the capabilities and the insights obtainable with the use of this formulation

metering systems and demand side management models applied to hybrid renewable energy systems in micro grid configuration abstract this paper proposes a demand side management model integrated to a metering system for hybrid renewable energy systems in micro grid configuration the proposal is based on the management problems verified in most of this kind of renewable hybrid systems installed in brazil the main idea is the implementation of a pre paid metering system with some control functions that directly act on the consumer demand restricting the consumption proportionally to the monthly availability of renewable energy the result is a better distribution of the electricity consumption by month and by consumer preventing that only one user with larger purchasing power consumes all the renewable energy available at some time period the proportionality between the consumption and the renewable energy s availability has the objective to prevent a lack of energy stored and a high use of the diesel generator set on months of low renewable potential this paper also aims to contribute to the brazilian regulation of renewable energy systems supplying micro grids

a welfare analysis of electricity transmission planning in germany we analyze the electricity transmission planning process in germany netzentwicklungsplan which separates transmission expansion decisions from generation dispatch we employ an economic modeling approach to analyze two different network planning settings in the first setting there is no trade off between transmission network development and generation dispatch as is currently the case in germany a second setting alternatively allows for such a trade off and thus represents a welfare superior way of transmission network planning applications with the two model variants are carried out for the german electricity system in 2035 the results illustrate overinvestment in transmission capacity and decreased welfare associated with the netzentwicklungsplan

implementation of renewable energy in scottish rural area a social study abstract nowadays renewable energy is considered one of the valuable sources of energy in the energy sector it is contributing major role in fulfilling the increasing level of global energy crisis although most of study of renewable energy is done through its technological development and a few are done in its acceptance level socially in such consequences this research considers the social acceptability of renewable energy in terms of economical environmental and cultural perspectives as a test bed scottish rural areas were considered for this social study where the areas are regarded as lacking of continuous energy supply due to weak grid and socio economic growth this research investigates the intimate and sensitive nature of the social issues in rural scotland that are important in the communities when decisions are made on renewable energy supply and demand the social interactions are investigated by means of both interviewing the local residents and distributed questionnaires among them the responses from the interviews and the questions are analyzed according to the predefined criterion of renewable energy such as willingness to accept changes of life style income and pay and education and employment

sustainable energy systems role of optimization modeling techniques in power generation and supply a review electricity is conceivably the most multipurpose energy carrier in modern global economy and therefore primarily linked to human and economic development energy sector reform is critical to sustainable energy development and includes reviewing and reforming subsidies establishing credible regulatory frameworks developing policy environments through regulatory interventions and creating market based approaches energy security has recently become an important policy driver and privatization of the electricity sector has secured energy supply and provided cheaper energy services in some countries in the short term but has led to contrary effects elsewhere due to increasing competition resulting in deferred investments in plant and infrastructure due to longer term uncertainties on the other hand global dependence on fossil fuels has led to the release of over 1100 gtco2 into the atmosphere since the mid 19th century currently energy related ghg emissions mainly from fossil fuel combustion for heat supply electricity generation and transport account for around 70 of total emissions including carbon dioxide methane and some traces of nitrous oxide this multitude of aspects play a role in societal debate in comparing electricity generating and supply options such as cost ghg emissions radiological and toxicological exposure occupational health and safety employment domestic energy security and social impressions energy systems engineering provides a methodological scientific framework to arrive at realistic integrated solutions to complex energy problems by adopting a holistic systems based approach especially at decision making and planning stage modeling and optimization found widespread applications in the study of physical and chemical systems production planning and scheduling systems location and transportation problems resource allocation in financial systems and engineering design this article reviews the literature on power and supply sector developments and analyzes the role of modeling and optimization in this sector as well as the future prospective of optimization modeling as a tool for sustainable energy systems

national strategic investment in european power transmission capacity abstract the transformation of the european electricity system requires substantial investment in transmission capacity to facilitate cross border trade and to efficiently integrate renewable energy sources however network planning in the eu is still mainly a national prerogative in contrast to other studies aiming to identify the pan european continental welfare optimal transmission expansion we investigate the impact of zonal planners deciding on network investment strategically with the aim of maximizing the sum of consumer surplus generator profits and congestion rents in their jurisdiction this reflects the inadequacy of current mechanisms to compensate for welfare re allocations across national boundaries arising from network upgrades we propose a three stage equilibrium model to describe the nash game between zonal planners i e national governments regulators or system operators each taking into account the impact of network expansion on the electricity spot market and the resulting welfare effects on the constituents within its jurisdiction we propose a novel way to solve the resulting gne epec type problem using a variation of a disjunctive constraints reformulation this allows to solve this problem without a priori assumptions on the relative valuation of shared constraints by each player using a four node sample network we identify several nash equilibria of the game between the zonal planners this example illustrates the failure to reach the first best welfare expansion in the absence of an effective framework for cross border cost benefit allocation

review of grid tie micro generation systems without energy storage towards a new approach to sustainable hybrid energy systems linked to energy efficiency abstract this paper reviews the literature on the subject albeit approaching hybrid micro generation power systems from a systems thinking st and cybernetics standpoint viewing them as dynamically complex adaptive systems cas coupled with and supplying to a set of homes termed a sustainable block in a rural setting here homeostatic regulation hr and control play a vital role in reaching efficient equilibrium towards reconciling power supply and demand response management unlike most of the work reviewed in the literature the focus here is on supervisory control of grid connected micro generation systems without energy storage aiming towards building energy efficiency thriftiness and sustainability in energy consumption building on homeostatic control hc principles first introduced by f c schweppe in 1979 the paper explores the concepts of sustainability and sustainable hybrid energy systems shes applied to micro generation focusing on operational aspects rather than on socio economic environmental or regulatory ones a concrete theoretical model for building a shes is presented for a proposed grid connected renewable microgrid the model seeks to reconcile power supply and demand towards efficient equilibrium homeostasis proposing reward based criteria for controlling renewable electricity supply and consumption in rural communities in chile discussion and recommendations are also offered stating that energy sustainability es is essentially a systems issue and one where es is first and foremost a structural organizational and operational property which is in the very nature of the system itself it is built into it rather than explained by exogenous factors

influence of role stress on industrial salespeople s work outcomes in the united states japan and korea role theory espouses and extensive empirical research has found that role stress can have deleterious effect on work outcomes of sales personnel the findings of these investigations however are predicated on u s based samples of salespeople whether similar results would be obtained with samples of salespersons in other countries has not yet been determined this paper reports the results of a study that examined the impact of role stress on performance job satisfaction and organizational commitment of industrial salespeople from the united states japan and korea tests of cross national hypotheses indicate general consistency in the findings across the three countries

uncertain bidding zone configurations the role of expectations for transmission and generation capacity expansion abstract ongoing policy discussions on the reconfiguration of bidding zones in european electricity markets induce uncertainty about the future market design this paper deals with the question of how this uncertainty affects market participants and their long run investment decisions in generation and transmission capacity generalizing the literature on pro active network expansion planning we propose a stochastic multilevel model which incorporates generation capacity investment network expansion and market operation taking into account uncertainty about the future bidding zone configuration using a stylized two node network we disentangle different effects that uncertainty has on market outcomes if there is a possibility that future bidding zone configurations provide improved regional price signals welfare gains materialize even if the change does not actually take place as a consequence welfare gains of an actual change of the bidding zone configuration are substantially lower due to those anticipatory effects additionally we show substantial distributional effects in terms of both expected gains and risks between producers and consumers and between different generation technologies

transmission and generation investment in electricity markets the effects of market splitting and network fee regimes abstract we propose an equilibrium model that allows to analyze the long run impact of the electricity market design on transmission line expansion by the regulator and investment in generation capacity by private firms in liberalized electricity markets the model incorporates investment decisions of the transmission system operator and private firms in expectation of an energy only market and cost based redispatch in different specifications we consider the cases of one vs multiple price zones market splitting and analyze different approaches to recover network cost in particular lump sum generation capacity based and energy based fees in order to compare the outcomes of our multilevel market model with a first best benchmark we also solve the corresponding integrated planner problem using two test networks we illustrate that energy only markets can lead to suboptimal locational decisions for generation capacity and thus imply excessive network expansion market splitting heals these problems only partially these results are valid for all considered types of network tariffs although investment slightly differs across those regimes

sustainable transmission planning in imperfectly competitive electricity industries balancing economic and environmental outcomes abstract we explore the role of a transmission system operator tso that builds a transmission line to accommodate renewable energy in order to lower emissions as required by government policy in contrast to central planning a tso in a deregulated electricity industry can only indirectly influence outcomes through its choice of the transmission line capacity via a bi level model we show that this results in less transmission capacity and with limited emissions control in a perfectly competitive industry vis a vis a benchmark centrally planned system a carbon charge on industry that fully accounts for the cost of pollution damage leads to a perfect alignment of incentives and maximised social welfare only under perfect competition by contrast a carbon charge may actually lower social welfare under a cournot oligopoly as the resulting reduction in consumption facilitates the further exercise of market power

policy watch the economics of fuel economy standards one of the most hotly contested of all energy policy issues involves corporate average fuel economy or cafe standards for new cars and light duty trucks tighter standards would reduce gasoline consumption and hence both greenhouse gas emissions as well as this country s vulnerability to oil price shocks but they would also increase the price of new vehicles worsen traffic congestion and depending on how they are phased in possibly even reduce occupant safety these effects are amenable to economic analysis and we review the evidence to date bearing on this interesting and important question

do generation firms in restructured electricity markets have incentives to support social welfare improving transmission investments this paper examines the incentives that generation firms have in restructured electricity markets for supporting long term transmission investments in particular we study whether generation firms which arguably play a dominant role in the restructured electricity markets have the incentives to fund or support incremental social welfare improving transmission investments we examine this question in a two node network and explore how such incentives are affected by the ownership of financial transmission rights ftrs by generation firms in the analyzed two node network we show both i that the net exporter generation firm has the correct incentives to increase the transmission capacity incrementally up to a certain level and ii that although a policy that allocates ftrs to the net exporter generation firm can be desirable from a social point of view such a policy would dilute the net importer generation firm s incentives to support transmission expansion moreover if all ftrs were allocated or auctioned off to the net exporter generation firm then it is possible to increase both consumer surplus and social welfare while keeping the net exporter generation firm revenue neutral

market design and investment incentives the purpose of this study was to understand how market design affects market performance through its impact on investment incentives for this purpose we model capacity choices by two ex ante identical firms which compete in the product market we analyse a number of different market design elements including i two commonly used auction formats the uniform price and discriminatory auctions ii price caps and iii bid duration we find that although the discriminatory auction tends to lower prices this does not imply that investment incentives at the margin are poorer indeed aggregate capacity is the same under both auction formats

economic criteria for planning transmission investment in restructured electricity markets from an economic perspective a common criterion for assessing the merits of a transmission investment is its impacts on social welfare the underlying assumption in using this criterion is that side payments may be used to distribute the social gains among all market players in reality however since the impacts of an electricity transmission project on different players may vary such side payments are rather difficult to implement this paper focuses on different economic criteria that should be considered when planning electricity transmission investments we propose an electricity transmission investment assessment methodology that is capable of evaluating the economic impacts on the various effected stakeholders and account for strategic responses that could enhance or impede the investment s objectives we formulate transmission planning as an optimization problem under alternative conflicting objectives and investigate the policy implications of divergent expansion plans resulting from the planner s level of anticipation of strategic responses we find that optimal transmission expansion plans may be very sensitive to supply and demand parameters we also show that the transmission investments have significant distributional impact creating acute conflicts of interests among market participants we use a 32 bus representation of the main chilean grid to illustrate our results

the eu regulation on cross border trade of electricity a two stage equilibrium model the regulation on cross border exchanges of electricity in the european union is meant to enhance the trade of electricity between member states by facilitating access to the network and improving the management of congestion at the interconnections this paper presents a computational model that embeds these two features the problem is cast in the form of a two stage equilibrium between regional regulators in the first stage they decide on the allocation of their regional network costs between generators and customers either they maximise their regional welfare non cooperatively nash equilibrium or they centralise the decision as a super regulator leading to a cooperative equilibrium in the second stage equilibrium the consequences of first stage s decisions are assessed by modelling the energy market as the result of imperfect competition equilibrium on competitive market coupled with regulated pricing on the domestic less competitive markets the rules that come out of the first stage game largely influence the final equilibrium we illustrate this on an extensive numerical example showing that the model behaves properly and identifying policy issues worth of further investigations c 2006 elsevier b v all rights reserved