Journal article
Transition to Centralized Unit Commitment: An Econometric Analysis of Colombia's Experience
The Energy journal (Cambridge, Mass.), Vol.37(3), pp.271-291
07/01/2016
DOI: 10.5547/01956574.37.3.aria
Abstract
This paper attempts to shed light on the relative merits of centralized electricity markets with multipart bids and dispatch using an MIP-based unit commitment optimization approach vs. self-committed markets with linear energy supply curves. We conduct an empirical study of data from the Colombian market, which in 2009 transitioned from a self-commitment paradigm to a centralized unit commitment approach where generators offer a linear supply function for energy along with start-up costs while the commitment and dispatch are determined by the system operator using MIP-based optimization. The results indicate that the transition to centralized dispatch has resulted in productive efficiency gains through a decrease in production costs. However, these gains have not translated into wholesale price decreases; in fact, wholesale prices increased after the change in the dispatch approach. These results suggest that productive efficiency gains have been captured by suppliers through the exercise of market power.
Details
- Title: Subtitle
- Transition to Centralized Unit Commitment: An Econometric Analysis of Colombia's Experience
- Creators
- Álvaro RiascosMigueí BernalLuciano de CastroShmuel Oren
- Resource Type
- Journal article
- Publication Details
- The Energy journal (Cambridge, Mass.), Vol.37(3), pp.271-291
- Publisher
- Energy Economics Education Foundation, Inc
- DOI
- 10.5547/01956574.37.3.aria
- ISSN
- 0195-6574
- eISSN
- 1944-9089
- Language
- English
- Date published
- 07/01/2016
- Academic Unit
- Economics
- Record Identifier
- 9984380406102771
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