Advanced SearchSearch Tips
Strategy Equilibrium in Stackelberg Model with Transmission Congestion in Electricity Market
facebook(new window)  Pirnt(new window) E-mail(new window) Excel Download
 Title & Authors
Strategy Equilibrium in Stackelberg Model with Transmission Congestion in Electricity Market
Lee, Kwang-Ho;
  PDF(new window)
Nash Cournot Equilibrium (NCE) has been widely used in a competitive electricity market to analyze generation firms` strategic production quantities. Congestion on a transmission network may lead to a mixed strategy NCE. Mixed strategy is complicated to understand, difficult to compute, and hard to implement in practical market. However, Stackelberg model based equilibrium does not have any mixed strategy, even under congestion in a transmission line. A guide to understanding mixed strategy equilibrium is given by analyzing a cycling phenomenon in the players` best choices. This paper connects the concept of leader-follower in Stackelberg model with relations between generation firms on both sides of the congested line. From the viewpoint of social welfare, the surplus analysis is presented for comparison between the NCE and the Stackelberg equilibrium (SE).
Stackelberg model;Nash equilibrium;Cournot model;Mixed strategy;Congestion;Social welfare;Leader-follower;Duopoly;Electricity market;
 Cited by
Transmission Network Expansion Planning Using Reliability and Economic Assessment,;;;

Journal of Electrical Engineering and Technology, 2015. vol.10. 3, pp.895-904 crossref(new window)
Optimal real time cost-benefit based demand response with intermittent resources, Energy, 2015, 90, 1695  crossref(new windwow)
Non-cooperative game theory based energy management systems for energy district in the retail market considering DER uncertainties, IET Generation, Transmission & Distribution, 2016, 10, 12, 2999  crossref(new windwow)
J. Contreras, M. Klusch, and J. B. Krawczyk, "Numerical solutions to Nash-Cournot equilibria in coupled constraint electricity markets," IEEE Trans. Power Syst., Vol. 19, No. 1, pp. 195-206, Feb. 2004. crossref(new window)

V. P. Gountis, and A. G. Bakirtzis, "Efficient determination of Cournot equilibria in electricity markets," IEEE Trans. Power Syst., Vol. 19, No. 4, pp. 1837-1844, Nov. 2004. crossref(new window)

W. Xian, L. Yuzeng, and Z. Shaohua, "Oligopolistic equilibrium analysis for electricity market: a nonlinear complementarity approach," IEEE Trans. Power Syst., Vol. 19, No. 3, pp. 1348-1355,Aug. 2004.

P. F. Correica, T. J. Overbye, and I. A. Hiskens, "Searching for noncooperative equilibria in centralized electricity markets," IEEE Trans. Power Syst., Vol. 18, No. 4, pp. 1417-1424, Nov. 2003. crossref(new window)

J. D. Weber and T. J. Overbye, "An individual welfare maximization algorithm for electricity markets," IEEE Trans. Power Syst., Vol. 17, No. 3, pp. 590-596, Aug. 2002. crossref(new window)

Severin Borenstein, James Bushnell, and Steven Stoft, "The Competitive effects of transmission capacity in a deregulated electricity industry," RAND Journal of Economics, Vol. 31, No. 2, pp. 294-325, Summer 2000. crossref(new window)

D. Fudenberg and J. Tirole, Game Theory. Cambridge, MA: MIT Press, 1991.

D. W. Carlton and J. M. Perloff, Modern Industrial Organization, Addison-Wesley. 2000.

B. F. Hobbs, "Linear complementarity model models of Nash-Cournot competition in bilateral and POOLCO power market," IEEE Trans. Power Syst., Vol. 16, No. 2, pp. 194-202, May 2001. crossref(new window)

A. L. Motto and F. D. Galiana, "Coordination in markets with nonconvexities as mathematical program with equilibrium constraints-part I: a solution procedure," IEEE Trans. Power Syst., Vol. 19, No. 1, Feb. 2004.

B. F. Hobbs, "Strategic gaming analysis for electric power systems: an MPEC approach," IEEE Trans. Power Syst., Vol. 15, No. 2, pp. 638-645, May 2000. crossref(new window)

A. V. Heusinger and C. Kanzow, "Optimization reformulations of the generalized Nash equilibrium problem using Nikaido-Isoda-type functions," Computational Optimization and Applications, Vol. 43, No. 2, pp. 353-377, 2009. crossref(new window)

J. B. Krawczyk, Jacek and Zuccolo, NIRA-3: An improved MATLAB package for finding Nash Equilibria in infinite games, in Working Paper, Dec. 2006.

K. H. Lee, "Solving Mixed Strategy Nash-Cournot Equilibria under Generation and Transmission Constraints in Electricity Market," Journal of Electrical Engineering & Technology, Vol. 8, No. 4, pp. 675-685, 2013. crossref(new window)

K. H. Lee and R. Baldick,"Tuning of discretization in bimatrix game approach to power system market analysis," IEEE Trans. Power Syst., Vol. 18, No. 2, pp. 830-836, May 2003. crossref(new window)

Maria de Lujan Latorre and Sergio Granville, "The Stackelberg Equilibrium Applied to AC Power Systems-A Non-Interior Point Algorithm," IEEE Trans. Power Syst., Vol. 18, No. 2, pp. 611-618, May. 2003. crossref(new window)

Y. Chen, B. F. Hobbs, S. Leyffer and T. S. Munson, "Leader-Follower Equilibria for Electric Power and NOx Allowances Markets," Comput. Manage. Sci., Vol. 3, No. 4, pp. 307-330, 2006. crossref(new window)

A. J. Wood and B. F. Wollenberg, Power Generation, Operation, and Control, New York: Wiley-Interscience, 1996.

S. Song, J. Jeong, Y. T. Yoon and S. Moon, "Model of Information Exchange for Decentralized Congestion Management," Journal of Electrical Engineering & Technology, Vol. 7, No. 2, pp. 141-150, 2012. crossref(new window)

Roy Gardner, Games for Business and Economics, John Wiley& Sons, Inc. 2003.