Power Market Theory

Security of supply and vulnerability: Security of supply, specifically related to incentives for investment in generation, but also transmisson, is an unsolved challenge in today's power markets. The course will discuss the background of the problem and introduce presently implemented and proposed solutions. Transmission pricing and handling of bottlenecks: Methods for transmission pricing and handling of bottlenecks, with emphasis on flow based market splitting. Variable renewable energy in the power marked: The influence of solar and wind power on the power market. Instruments for ensuring balancing and capacity in power systems with large amounts of solar and wind power. Market power: Alternative models for analysis of market power in power markets. Market power in relation to transmission constraints. How is market power measured, what can be done to reduce or avoid market power. International practice and experience. Ancillary services: Handling of ancillary services in various power markets. Demand flexibility: Present power markets are mostly one-sided: Producers are active market participants, while consumers are more or less passive. This has a number of negative effects, and development of a more flexible demand side will result in substantial improvements. Background, opportunities and developments.

Knowledge: After completing the course, the student shall have a thorough understanding of central issues in power markets, as well as methods and theories that are in use or proposed to solve these issues. Skilles: After completing the course, the student shall be able to utilize methods and theory to propose solutions to issues in power markets.

Lectures and mandatory excercises. The course is given every second year.