The Experts below are selected from a list of 8145 Experts worldwide ranked by ideXlab platform
Par Holmberg - One of the best experts on this subject based on the ideXlab platform.
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On Supply-Function equilibria in radial transmission networks
European Journal of Operational Research, 2018Co-Authors: Par Holmberg, Andy PhilpottAbstract:Abstract Transmission constraints limit competition and arbitrageurs’ possibilities of exploiting price differences between commodities in neighbouring markets. We analyze radial transmission-constrained networks with local demand shocks, where spatially distributed oligopoly producers compete with Supply Functions, as in wholesale electricity markets. We prove existence and uniqueness of Supply-Function equilibrium in two-node networks, and we are able to explicitly solve for symmetric Supply-Function equilibria in two-node and star networks.
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Supply Function Equilibria in Networks with Transport Constraints
SSRN Electronic Journal, 2015Co-Authors: Par Holmberg, Andy PhilpottAbstract:Transport constraints limit competition and arbitrageurs possibilities of exploiting price differences between commodities in neighbouring markets. We analyze a transport-constrained network with local demand shocks, where spatially distributed oligopoly producers compete with Supply Functions, as in wholesale electricity markets. Uniqueness and existence results are proven, and we are able to explicitly solve for symmetric Supply-Function equilibria in some special cases.
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Supply Function equilibria in transportation networks
2014Co-Authors: Par Holmberg, Andy PhilpottAbstract:Transport constraints limit competition and arbitrageurs' possibilities of exploiting price differences between commodities in neighbouring markets. We analyze a transportation network where oligopoly producers compete with Supply Functions under uncertain demand, as in wholesale electricity markets. For symmetric networks with a radial structure, we show that existence of symmetric Supply Function equilibria (SFE) is ensured if demand shocks are sufficiently evenly distributed. We can explicitly solve for them for uniform multi-dimensional nodal demand shocks.
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Supply Function equilibria step Functions and continuous representations
Journal of Economic Theory, 2013Co-Authors: Par Holmberg, David M Newbery, Daniel RalphAbstract:In most wholesale electricity markets generators must submit step-Function offers of Supply to a uniform price auction, and the market is cleared at the price of the most expensive offer needed to meet realised demand. Such markets can most elegantly be modelled as the pure-strategy, Nash Equilibrium of continuous Supply Functions, in which each supplier has a unique profit maximising choice of Supply Function given the choices of other suppliers. Critics argue that the discreteness and discontinuity of the required steps can rule out pure-strategy equilibria and may result in price instability. This paper argues that if prices must be selected from a finite set the resulting step Function converges to the continuous Supply Function as the number of steps increases, reconciling the apparently very disparate approaches to modelling electricity markets.
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the Supply Function equilibrium and its policy implications for wholesale electricity auctions
Utilities Policy, 2010Co-Authors: Par Holmberg, David M NewberyAbstract:The Supply Function equilibrium provides a game-theoretic model of strategic bidding in oligopolistic wholesale electricity auctions. This paper presents an intuitive account of current understanding and shows how welfare losses depend on the number of firms in the market and their asymmetry. Previous results and general recommendations for divisible-good/multi-unit auctions provides guidance on the design of the auction format, setting the reservation price, the rationing rule, and restrictions on the offer curves in wholesale electricity auctions.
Robert N Stavins - One of the best experts on this subject based on the ideXlab platform.
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land use change and carbon sinks econometric estimation of the carbon sequestration Supply Function
Journal of Environmental Economics and Management, 2001Co-Authors: Ruben N Lubowski, Andrew J Plantinga, Robert N StavinsAbstract:When and if the United States chooses to implement a greenhouse gas reduction program, it will be necessary to decide whether carbon sequestration policies - such as those that promote forestation and discourage deforestation - should be part of the domestic portfolio of compliance activities. We investigate the cost of forest-based carbon sequestration. In contrast with previous approaches, we econometrically examine micro-data on revealed landowner preferences, modeling six major private land uses in a comprehensive analysis of the contiguous United States. The econometric estimates are used to simulate landowner responses to sequestration policies. Key commodity prices are treated as endogenous and a carbon sink model is used to predict changes in carbon storage. Our estimated marginal costs of carbon sequestration are greater than those from previous engineering cost analyses and sectoral optimization models. Our estimated sequestration Supply Function is similar to the carbon abatement Supply Function from energy-based analyses, suggesting that forest-based carbon sequestration merits inclusion in a cost-effective portfolio of domestic U.S. climate change strategies.
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land use change and carbon sinks econometric estimation of the carbon sequestration Supply Function
Other Information: PBD: 1 Jan 2001, 2001Co-Authors: Ruben N Lubowski, Andrew J Plantinga, Robert N StavinsAbstract:Increased attention by policy makers to the threat of global climate change has brought with it considerable interest in the possibility of encouraging the expansion of forest area as a means of sequestering carbon dioxide. The marginal costs of carbon sequestration or, equivalently, the carbon sequestration Supply Function will determine the ultimate effects and desirability of policies aimed at enhancing carbon uptake. In particular, marginal sequestration costs are the critical statistic for identifying a cost-effective policy mix to mitigate net carbon dioxide emissions. We develop a framework for conducting an econometric analysis of land use for the forty-eight contiguous United States and employing it to estimate the carbon sequestration Supply Function. By estimating the opportunity costs of land on the basis of econometric evidence of landowners' actual behavior, we aim to circumvent many of the shortcomings of previous sequestration cost assessments. By conducting the first nationwide econometric estimation of sequestration costs, endogenizing prices for land-based commodities, and estimating land-use transition probabilities in a framework that explicitly considers the range of land-use alternatives, we hope to provide better estimates eventually of the true costs of large-scale carbon sequestration efforts. In this way, we seek to add to understanding of the costs and potential of this strategy for addressing the threat of global climate change.
Ruben N Lubowski - One of the best experts on this subject based on the ideXlab platform.
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land use change and carbon sinks econometric estimation of the carbon sequestration Supply Function
Journal of Environmental Economics and Management, 2001Co-Authors: Ruben N Lubowski, Andrew J Plantinga, Robert N StavinsAbstract:When and if the United States chooses to implement a greenhouse gas reduction program, it will be necessary to decide whether carbon sequestration policies - such as those that promote forestation and discourage deforestation - should be part of the domestic portfolio of compliance activities. We investigate the cost of forest-based carbon sequestration. In contrast with previous approaches, we econometrically examine micro-data on revealed landowner preferences, modeling six major private land uses in a comprehensive analysis of the contiguous United States. The econometric estimates are used to simulate landowner responses to sequestration policies. Key commodity prices are treated as endogenous and a carbon sink model is used to predict changes in carbon storage. Our estimated marginal costs of carbon sequestration are greater than those from previous engineering cost analyses and sectoral optimization models. Our estimated sequestration Supply Function is similar to the carbon abatement Supply Function from energy-based analyses, suggesting that forest-based carbon sequestration merits inclusion in a cost-effective portfolio of domestic U.S. climate change strategies.
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land use change and carbon sinks econometric estimation of the carbon sequestration Supply Function
Other Information: PBD: 1 Jan 2001, 2001Co-Authors: Ruben N Lubowski, Andrew J Plantinga, Robert N StavinsAbstract:Increased attention by policy makers to the threat of global climate change has brought with it considerable interest in the possibility of encouraging the expansion of forest area as a means of sequestering carbon dioxide. The marginal costs of carbon sequestration or, equivalently, the carbon sequestration Supply Function will determine the ultimate effects and desirability of policies aimed at enhancing carbon uptake. In particular, marginal sequestration costs are the critical statistic for identifying a cost-effective policy mix to mitigate net carbon dioxide emissions. We develop a framework for conducting an econometric analysis of land use for the forty-eight contiguous United States and employing it to estimate the carbon sequestration Supply Function. By estimating the opportunity costs of land on the basis of econometric evidence of landowners' actual behavior, we aim to circumvent many of the shortcomings of previous sequestration cost assessments. By conducting the first nationwide econometric estimation of sequestration costs, endogenizing prices for land-based commodities, and estimating land-use transition probabilities in a framework that explicitly considers the range of land-use alternatives, we hope to provide better estimates eventually of the true costs of large-scale carbon sequestration efforts. In this way, we seek to add to understanding of the costs and potential of this strategy for addressing the threat of global climate change.
Edward J. Anderson - One of the best experts on this subject based on the ideXlab platform.
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On Supply Function Bidding in Electricity Markets
Decision Making Under Uncertainty, 2020Co-Authors: Edward J. Anderson, Andy PhilpottAbstract:We consider wholesale electricity market pools in which generators must offer Supply Functions that are centrally dispatched. Each generator seeks a Supply Function to offer to the spot market, so as to maximise expected return. We give conditions under which a Supply Function exists that optimises return for every demand realisation. We also analyse the case in which the behaviour of the competition can be modelled by an appropriate probability distribution, and derive optimality conditions for the optimal Supply-Function offer in this case. The paper concludes with some remarks on applying the theory to the case where each generator must offer a limited number of prices in their stack.
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On the existence of Supply Function equilibria
Mathematical Programming, 2013Co-Authors: Edward J. AndersonAbstract:Supply Function equilibria are used in the analysis of divisible good auctions with a large number of identical objects to be sold or bought. An important example occurs in wholesale electricity markets. Despite the substantial literature on Supply Function equilibria the existence of a pure strategy Nash equilibria for a uniform price auction in asymmetric cases has not been established in a general setting. In this paper we prove the existence of a Supply Function equilibrium for a duopoly with asymmetric firms having convex non-decreasing marginal costs, with decreasing concave demand subject to an additive demand shock, provided that the second derivative of the demand Function is small enough and not increasing. The proof is constructive and also gives insight into the structure of the equilibrium solutions.
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Asymmetric Supply Function Equilibria with Forward Contracts
Journal of Optimization Theory and Applications, 2011Co-Authors: Edward J. Anderson, Xinmin HuAbstract:We consider markets in which firms offer Supply Functions, rather than a quantity or price alone: the most important examples are wholesale electricity markets. The equilibria in such markets can be hard to characterize. In many cases, whole families of Supply Function equilibria occur so there are difficulties in determining which equilibrium will be chosen. In this paper, we consider Supply Function equilibria, when firms hold forward contracts, which is common in electricity markets. Under the assumption that contract positions have been fixed in advance, we characterize the families of Supply Function equilibria in a duopoly. The existence of forward contracts implies a tightening of the conditions for an equilibrium, and a greater likelihood that no equilibrium solution exists. In the case of three firms, there can be at most one Supply Function equilibrium, provided that the lowest demand be small enough.
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finding Supply Function equilibria with asymmetric firms
Operations Research, 2008Co-Authors: Edward J. Anderson, Xinmin HuAbstract:Firms compete in Supply Functions when they offer a schedule of prices and quantities into a market; for example, this occurs in many wholesale electricity markets. We study the equilibrium behaviour when firms differ, both with regard to their costs and their capacities. We characterize strong equilibrium solutions in which, given the other players' Supply Functions, optimal profits are achieved for every demand realisation. If the demand can be low enough for it to be met economically with Supply from just one firm, then the Supply Function equilibria are ordered in a natural way. We consider equilibria in which, for the highest levels of demand, all but one of the firms have reached their capacity limit. We show that there can be at most one Supply Function equilibrium with this property. We also propose a new numerical method to find asymmetric Supply Function equilibria, using piecewise-linear approximations and a discretization of the demand distribution. We show that this approach has good theoretical convergence behaviour. Finally, we present numerical results from an implementation using GAMS to demonstrate that the approach is effective in practice.
Andrew J Plantinga - One of the best experts on this subject based on the ideXlab platform.
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land use change and carbon sinks econometric estimation of the carbon sequestration Supply Function
Journal of Environmental Economics and Management, 2001Co-Authors: Ruben N Lubowski, Andrew J Plantinga, Robert N StavinsAbstract:When and if the United States chooses to implement a greenhouse gas reduction program, it will be necessary to decide whether carbon sequestration policies - such as those that promote forestation and discourage deforestation - should be part of the domestic portfolio of compliance activities. We investigate the cost of forest-based carbon sequestration. In contrast with previous approaches, we econometrically examine micro-data on revealed landowner preferences, modeling six major private land uses in a comprehensive analysis of the contiguous United States. The econometric estimates are used to simulate landowner responses to sequestration policies. Key commodity prices are treated as endogenous and a carbon sink model is used to predict changes in carbon storage. Our estimated marginal costs of carbon sequestration are greater than those from previous engineering cost analyses and sectoral optimization models. Our estimated sequestration Supply Function is similar to the carbon abatement Supply Function from energy-based analyses, suggesting that forest-based carbon sequestration merits inclusion in a cost-effective portfolio of domestic U.S. climate change strategies.
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land use change and carbon sinks econometric estimation of the carbon sequestration Supply Function
Other Information: PBD: 1 Jan 2001, 2001Co-Authors: Ruben N Lubowski, Andrew J Plantinga, Robert N StavinsAbstract:Increased attention by policy makers to the threat of global climate change has brought with it considerable interest in the possibility of encouraging the expansion of forest area as a means of sequestering carbon dioxide. The marginal costs of carbon sequestration or, equivalently, the carbon sequestration Supply Function will determine the ultimate effects and desirability of policies aimed at enhancing carbon uptake. In particular, marginal sequestration costs are the critical statistic for identifying a cost-effective policy mix to mitigate net carbon dioxide emissions. We develop a framework for conducting an econometric analysis of land use for the forty-eight contiguous United States and employing it to estimate the carbon sequestration Supply Function. By estimating the opportunity costs of land on the basis of econometric evidence of landowners' actual behavior, we aim to circumvent many of the shortcomings of previous sequestration cost assessments. By conducting the first nationwide econometric estimation of sequestration costs, endogenizing prices for land-based commodities, and estimating land-use transition probabilities in a framework that explicitly considers the range of land-use alternatives, we hope to provide better estimates eventually of the true costs of large-scale carbon sequestration efforts. In this way, we seek to add to understanding of the costs and potential of this strategy for addressing the threat of global climate change.
