On the stability of wholesale electricity markets under real-time pricing
The paper proposes a mathematical model for the dynamic evolution of supply, demand, and clearing prices under a class of real-time pricing mechanisms characterized by passing on the real-time wholesale prices to the end consumers. The effects that such mechanisms could pose on the stability and eff...
| Main Authors: | , , |
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| Other Authors: | |
| Format: | Article |
| Language: | en_US |
| Published: |
Institute of Electrical and Electronics Engineers
2012
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| Online Access: | http://hdl.handle.net/1721.1/71673 https://orcid.org/0000-0002-1470-2148 https://orcid.org/0000-0002-8619-1295 |
| _version_ | 1826193367815421952 |
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| author | Roozbehani, Mardavij Dahleh, Munther A. Mitter, Sanjoy K. |
| author2 | Massachusetts Institute of Technology. Department of Electrical Engineering and Computer Science |
| author_facet | Massachusetts Institute of Technology. Department of Electrical Engineering and Computer Science Roozbehani, Mardavij Dahleh, Munther A. Mitter, Sanjoy K. |
| author_sort | Roozbehani, Mardavij |
| collection | MIT |
| description | The paper proposes a mathematical model for the dynamic evolution of supply, demand, and clearing prices under a class of real-time pricing mechanisms characterized by passing on the real-time wholesale prices to the end consumers. The effects that such mechanisms could pose on the stability and efficiency of the entire system is investigated and several stability criteria are presented. It is shown that relaying the real-time wholesale electricity prices to the end consumers creates a closed loop feedback system which could be unstable or lack robustness, leading to extreme price volatility. Finally, a result is presented which characterizes the efficiency losses incurred when, in order to achieve stability, the wholesale prices are adjusted by a static pricing function before they are passed on to the retail consumers. |
| first_indexed | 2024-09-23T09:37:57Z |
| format | Article |
| id | mit-1721.1/71673 |
| institution | Massachusetts Institute of Technology |
| language | en_US |
| last_indexed | 2024-09-23T09:37:57Z |
| publishDate | 2012 |
| publisher | Institute of Electrical and Electronics Engineers |
| record_format | dspace |
| spelling | mit-1721.1/716732022-09-30T15:48:10Z On the stability of wholesale electricity markets under real-time pricing Roozbehani, Mardavij Dahleh, Munther A. Mitter, Sanjoy K. Massachusetts Institute of Technology. Department of Electrical Engineering and Computer Science Massachusetts Institute of Technology. Laboratory for Information and Decision Systems Dahleh, Munther A. Roozbehani, Mardavij Dahleh, Munther A. Mitter, Sanjoy K. The paper proposes a mathematical model for the dynamic evolution of supply, demand, and clearing prices under a class of real-time pricing mechanisms characterized by passing on the real-time wholesale prices to the end consumers. The effects that such mechanisms could pose on the stability and efficiency of the entire system is investigated and several stability criteria are presented. It is shown that relaying the real-time wholesale electricity prices to the end consumers creates a closed loop feedback system which could be unstable or lack robustness, leading to extreme price volatility. Finally, a result is presented which characterizes the efficiency losses incurred when, in order to achieve stability, the wholesale prices are adjusted by a static pricing function before they are passed on to the retail consumers. Siemens Aktiengesellschaft 2012-07-18T12:37:45Z 2012-07-18T12:37:45Z 2011-02 2010-12 Article http://purl.org/eprint/type/ConferencePaper 978-1-4244-7745-6 0743-1546 http://hdl.handle.net/1721.1/71673 Roozbehani, M.; Dahleh, M.; Mitter, S.; , "On the stability of wholesale electricity markets under real-time pricing," Decision and Control (CDC), 2010 49th IEEE Conference on , vol., no., pp.1911-1918, 15-17 Dec. 2010 doi: 10.1109/CDC.2010.5718173 © Copyright 2010 IEEE https://orcid.org/0000-0002-1470-2148 https://orcid.org/0000-0002-8619-1295 en_US http://dx.doi.org/ 10.1109/CDC.2010.5718173 49th IEEE Conference on Decision and Control (CDC), 2010 Article is made available in accordance with the publisher's policy and may be subject to US copyright law. Please refer to the publisher's site for terms of use. application/pdf Institute of Electrical and Electronics Engineers IEEE |
| spellingShingle | Roozbehani, Mardavij Dahleh, Munther A. Mitter, Sanjoy K. On the stability of wholesale electricity markets under real-time pricing |
| title | On the stability of wholesale electricity markets under real-time pricing |
| title_full | On the stability of wholesale electricity markets under real-time pricing |
| title_fullStr | On the stability of wholesale electricity markets under real-time pricing |
| title_full_unstemmed | On the stability of wholesale electricity markets under real-time pricing |
| title_short | On the stability of wholesale electricity markets under real-time pricing |
| title_sort | on the stability of wholesale electricity markets under real time pricing |
| url | http://hdl.handle.net/1721.1/71673 https://orcid.org/0000-0002-1470-2148 https://orcid.org/0000-0002-8619-1295 |
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