Simulating the dynamics in two-settlement electricity markets via an agent-based approach

Abstract This paper studies the dynamics in two-settlement electricity markets. In these markets, energy producers sign strategic forward contracts in the forward market, and engage in spatial oligopolistic competition in the spot market. We develop an agent-based model for simulating the outcomes of such markets. Numerical simulations imply that the access to the forward market leads to more competitive behaviors of the suppliers in the spot market, and thus to lower spot energy prices.

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