The entity or entities oversee the day-to-day behaviour of market participants, the long-term effectiveness of market rules and the competitiveness of the market. [...] o Elasticity = - (dQ/dP)/(Q/P); [%change in quantity/%change in price, where d = delta/derivative/slope.] o If elasticity <1, demand for electricity is inelastic; the closer to 1 it gets, the less inelastic the market is and the less risk there is of market power; the closer to zero it gets, the more inelastic it is and the more risk there is of market power. [...] The first is the market operator itself internally reviewing the actions of the market players to ensure they are following market rules. [...] The market monitor also reviews the market rules, the efficiency and the overall competitiveness of the market, the adequacy of price signals to attract investment and to retain existing economic assets, etc., and provides recommendations to the market operator and the regulators. [...] The Division of Energy Market Assessments (DEMA) within FERC examines, analyses and reports on the structure and operation of the electric and natural gas markets, providing information to the Commission and the public on significant market events and trends.16 The DEMA observes market operations and performance to inform the development of policies that promote the competitiveness and efficiency.
Authors
- Pages
- 23
- Published in
- United States of America
Table of Contents
- Abstract 1
- Section 1. Introduction 3
- Section 2. Overview of market monitoring in India 4
- CERC scope 4
- CEA scope 4
- Section 3. Markets and market power 5
- Section 3A. Definition of electricity markets 5
- Section 3B(i). Definition of market power 7
- Section 3B(ii). Implications of exercising market power 7
- Section 3B(iii). Types of market power 9
- Vertical market power 9
- Horizontal market power 9
- Load pocket 10
- Section 3B(iv). Exercise of market power 10
- Section 3C. Primary structural defects leading to potential market power 10
- Section 3D. Measurement of market power 11
- Section 3E. Measures for mitigating market power 12
- Section 3F. The process for mitigating market power 13
- Section 4. Role of various entities in market monitoring: International experience 14
- Section 4A. Different entities performing market monitoring 14
- Section 4B. Organisation of internal and external market monitoring entities 15
- NYISO Market Mitigation and Analysis (MMA) group 15
- External market monitor 15
- Scope of market monitoring 17
- Central regulator market monitoring 17
- Section 4C. Attributes of the market monitor 18
- Section 4D. Data needs and access to data 18
- Section 5. Market monitoring tools 19
- Section 5A. Actions of the market monitor 19
- Section 5B. Analytical market monitoring tools and examples 20
- Concentration measures (often referred to as structure tests) 20
- Conduct and impact tests 20
- Table 1. Illustration of conduct and impact test scenarios 21
- Market behaviour 21
- ‘Withholding supply’ analysis 22
- Economic withholding 22
- Physical withholding 22
- Attraction of new entry and retirement of existing generation 22
- Conclusion 22
