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Modeling generation expansion in the context of a security of supply mechanism based on long-term auctions. Application to the Colombian case

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Listed:
  • Rodilla, P.
  • Batlle, C.
  • Salazar, J.
  • Sánchez, J.J.
Abstract
In an attempt to provide electricity generation investors with appropriate economic incentives so as to maintain quality of supply at socially optimal levels, a growing number of electricity market regulators have opted for implementing a security of supply mechanism based on long-term auctions. In this context, the ability to analyze long-term investment dynamics is a key issue not only for market agents, but also for regulators. This paper describes a model developed to serve this purpose. A general system-dynamics-inspired methodology has been designed to be able to simulate these long-term auction mechanisms in the formats presently in place. A full-scale simulation based on the Colombian system was conducted to illustrate model capabilities.

Suggested Citation

  • Rodilla, P. & Batlle, C. & Salazar, J. & Sánchez, J.J., 2011. "Modeling generation expansion in the context of a security of supply mechanism based on long-term auctions. Application to the Colombian case," Energy Policy, Elsevier, vol. 39(1), pages 176-186, January.
    • Handle: RePEc:eee:enepol:v:39:y:2011:i:1:p:176-186
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    References listed on IDEAS

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    1. Derek W. Bunn and Fernando Oliveira, 2001. "An Application of Agent-based Simulation to the New Electricity Trading Arrangements of England and Wales," Computing in Economics and Finance 2001 93, Society for Computational Economics.
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    Cited by:

    1. Shahriyar Nasirov & Eugenio Cruz & Claudio A. Agostini & Carlos Silva, 2019. "Policy Makers’ Perspectives on the Expansion of Renewable Energy Sources in Chile’s Electricity Auctions," Energies, MDPI, vol. 12(21), pages 1-17, October.
    2. Heidarizadeh, Mohammad & Ahmadian, Mohammad, 2019. "Capacity certificate mechanism: A step forward toward a market based generation capacity incentive," Energy, Elsevier, vol. 172(C), pages 45-56.
    3. Zapata, Sebastian & Castaneda, Monica & Franco, Carlos Jaime & Dyner, Isaac, 2019. "Clean and secure power supply: A system dynamics based appraisal," Energy Policy, Elsevier, vol. 131(C), pages 9-21.

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