Aggregator-Enabled Prosumers' Impact on Strategic Hydro-Thermal Operations

Farzad Hassanzadeh Moghimi, Yihsu Chen, Afzal Siddiqui

Research output: Chapter in Book/Report/Conference proceedingConference article in proceedingsScientificpeer-review

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Abstract

Climate packages envisage decarbonization of the power system and electrification of the wider economy via variable renewable energy (VRE). These trends facilitate the rise of aggregator-enabled prosumers and engender demand for flexibility. By exploiting conducive geography, e.g., in the Nordic region, hydro reservoirs can mitigate VRE's intermittency. Nevertheless, hydro producers may leverage this increased need for flexibility to exert market power through temporal arbitrage. Using a Nash-Cournot model, we examine how aggregator-enabled prosumers with endogenous loads and VRE capacity interact with other agents to affect market outcomes. Based on Nordic data, we find that hydro producers enhance their market power by shifting their production away from periods in which prosumers are net buyers and "dumping" their output during periods in which prosumers are net sellers. Hence, jurisdictions that rely upon (hydro) storage to integrate VRE from prosumers will need to be wary of incumbent firms' incentives to manipulate prices.
Original languageEnglish
Title of host publicationProceedings of the 56th Annual Hawaii International Conference on System Sciences, HICSS 2023
EditorsTung X. Bui
PublisherHawaii International Conference on System Sciences
Pages2693-2702
Number of pages10
ISBN (Electronic)978-0-9981331-6-4
Publication statusPublished - 3 Jan 2023
MoE publication typeA4 Conference publication
EventAnnual Hawaii International Conference on System Sciences - Maui, United States
Duration: 3 Jan 20236 Jan 2023
Conference number: 56

Publication series

NameProceedings of the Annual Hawaii International Conference on System Sciences
ISSN (Print)1530-1605
ISSN (Electronic)2572-6862

Conference

ConferenceAnnual Hawaii International Conference on System Sciences
Abbreviated titleHICSS
Country/TerritoryUnited States
CityMaui
Period03/01/202306/01/2023

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