We compare a one-level and a bilevel equilibrium game in which firms' flexibility is either: decided at the same time as their production decisions; or sequentially. We analize the impact that different market structures have on the equilibrium outcomes. Our findings are applied to the ramp bidding game in electricity markets. It is observed that electricity producers may strategically declare a lower ramp rate if they expect such decision to maximize their profit in the production stage.
INFORMS Anual Meeting - INFORMS 2015, Philadelphia, Pennsylvania (United States of America). 01-04 November 2015
Publication date: November 2015.
E. Moiseeva, M.R. Hesamzadeh, S. Wogrin, The impact of withholding flexibility: an application to ramp bidding in electricity markets, INFORMS Anual Meeting - INFORMS 2015. Filadelfia, United States of America, 01-04 November 2015