Strategic bidding in competitive electricity markets: a literature survey

Abstract

Participants in a competitive electricity market develop bidding strategies in order to maximize their own profits. On the other hand, it is necessary for regulators to investigate strategic bidding behavior in order to identify possible market power abuse and to limit such abuse by introducing appropriate market management rules. An interesting body of work has been done on this subject, and this paper presents a literature survey based on more than 30 research publications.