Ce mardi au GAEL : Laureen Deman, Post-doc Université Grenoble Alpes

Interaction of market-power exercise between day-ahead and real-time markets for energy and reserves

Mardi 13 décembre 2025, Laureen Deman

Résumé : Disequilibrium in electricity markets can have large costs for the society. As a result, reserve markets are organised to ensure that demand and supply are always balanced in real time. However, these markets are concentrated such that market power can alter their efficiency. 
This paper investigates strategic behaviours in reserve markets by analysing the interactions between forward and real-time markets for electricity and reserves. To do so, we extend the modelling frameworks of strategic behaviour in forward electricity markets and of short-term system reliability supply. Despite the public good nature of reserves, the results show the existence of a strategic motivation to sell reserves forward driven by a first-mover advantage. However, the efficiency of reserve markets to balance the system is altered by strategic adjustments of energy sales. A regulatory requirement, meant to circumvent the free-rider problem, significantly reduces the reserves sales, such that the introduction of a reserve market has a limited impact on the final allocations.
These results show that market power can be exercised in reserve markets, either directly with reserve capacity withholding in response to a regulatory requirement, or indirectly through increased capacity withholding in the other electricity markets.
 

Le séminaire a lieu à 13h00 en salle 227.