In some countries, consumers also compete to purchase energy by submitting demand side bids. The physical nature of electricity does not allow a true electricity spot market, i.e., a market for immediate electricity delivery.
Competitive pools are a substitute for a true spot market.
Since prices are determined from scheduled supply and demand, these are known as ex ante pools. I. Electricity pools perform two functions that can be, and sometimes are, unbundled. System operation is centralised in virtually all electricity systems due to technical constraints and to take advantage of the substantial economies of coordination. Second, the pool handles, at least in part, the economic operation of the system, i.e., it determines an economic merit order among pool generators and a price. I. Competitive pools allow free entry of generators into the market.