Summary:
The Brazilian power-market design features were based on the system's physical and economic characteristics in the ’90s. However, some of the approximations and assumptions adopted for the regulatory framework are no longer valid. Failing to adapt the regulatory framework to the current system and economic reality may provide poor market signals, possibly threatening the sustainability and supply adequacy of the long-run system. Despite the national consensus on the need for modernization, there are still many concerns about which changes should be carried out. The vast literature and international experience in the subject notwithstanding, each system's par- ticularities challenge any simplistic attempt to match the Brazilian case with previously reported experiences. Thus, this work aims to 1) define a general market design nomenclature and clas- sify relevant market structures, 2) draw a systematized panorama of the physical characteristics that have influenced the selection of different market designs and mechanisms, and 3) compare the Brazilian market design, to the international experience. Based on that, we contribute with an updated and standardized panorama of a few relevant market designs and structures. Addi- tionally, we raise awareness and discuss the lessons from the international experience applicable to support and foster the Brazilian market modernization agenda.
Spanish layman's summary:
Proporcionamos una comparación estandarizada de algunos diseños de mercado de electricidad relevantes y los contrastamos con el marco brasileño. Luego, discutimos las lecciones de la experiencia internacional que son aplicables para respaldar y fomentar la agenda de modernización del mercado brasileño, sugiriendo una agenda orientada hacia el futuro.
English layman's summary:
We provide a standardized comparison of a few relevant electricity market designs and contrast with the Brazilian framework. We then discuss the lessons from the international experience applicable to support and foster the Brazilian market modernization agenda, suggesting a forward-looking agenda.
Keywords: Wholesale electricity markets; Power market design; Brazilian power market; International power markets
JCR Impact Factor and WoS quartile: 3,900 - Q2 (2022)
DOI reference:
https://doi.org/10.1016/j.epsr.2023.109364
Published on paper: July 2023.
Published on-line: April 2023.
Citation:
L. Ribeiro, A. Street, D. Valladão, A.C. Freire, L.A. Barroso, Technical and economical aspects of wholesale electricity markets: An international comparison and main contributions for improvements in Brazil. Electric Power Systems Research. Vol. 220, pp. 109364-1 - 109364-24, July 2023. [Online: April 2023]
