{"title":"A study of basic bidding strategy in clearing pricing auctions","authors":"Shangyou Hao","doi":"10.1109/PICA.1999.779385","DOIUrl":null,"url":null,"abstract":"This paper models bidding behaviors of suppliers to electricity auction markets under clearing pricing rules and with some suppliers is derived by solving a set of differential equations that specify the necessary conditions for builders to maximize their expected payoffs. The derived result indicates that bidders have incentives to mark up their bid above their costs of production. The amount of markup depends on the probability of winning below and on the margin that are computed from the cost distribution of all suppliers, market demand and the number of suppliers participating in the auction.","PeriodicalId":113146,"journal":{"name":"Proceedings of the 21st International Conference on Power Industry Computer Applications. Connecting Utilities. PICA 99. To the Millennium and Beyond (Cat. No.99CH36351)","volume":"16 1","pages":"0"},"PeriodicalIF":0.0000,"publicationDate":"1999-05-16","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"146","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"Proceedings of the 21st International Conference on Power Industry Computer Applications. Connecting Utilities. PICA 99. To the Millennium and Beyond (Cat. No.99CH36351)","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.1109/PICA.1999.779385","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"","JCRName":"","Score":null,"Total":0}
引用次数: 146
Abstract
This paper models bidding behaviors of suppliers to electricity auction markets under clearing pricing rules and with some suppliers is derived by solving a set of differential equations that specify the necessary conditions for builders to maximize their expected payoffs. The derived result indicates that bidders have incentives to mark up their bid above their costs of production. The amount of markup depends on the probability of winning below and on the margin that are computed from the cost distribution of all suppliers, market demand and the number of suppliers participating in the auction.
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