Study On Equilibrium Theory And Evolutionary Analysis Of Electricity Markets

Along with the deepening of the reform of electricity markets and the continuous expansion of the power system , the security and stability of the power grid become more and more important. People increasingly began to be concerned about the stability of power system and electricity market issues. Competition arising therefrom environment electricity production, trade and consumption has been changed at all. The power system is operating under harsh and uncertain conditions. Thus the stability issues become increasingly acute. Each participant in the electricity market is always pursuing the maximum benefit. The relationship between technology and economy is so close. The electric power market is a large and complex system with characteristics of social economics and extremely profound physical backgrounds. Facing such a complex system, classical research methods have to struggle so as not to function below the level. In order to carry out in-depth studies of those internal reasons that have caused instability of electricity markets, we tried to establish the framework of electricity markets based on the market-based economic law and combined with the characteristics of power system. And we used the experimental methods to explore the internal laws of electricity markets.This article is based on the equilibrium theory of electricity markets. Through the equilibrium modeling and dynamic analysis, we found that the reasonable design of structures and mechanisms of electricity markets is the key way to explore the equilibrium problems. According to the automata network method of complex systems, the model of electric power markets can be set up: cost, maximum supply and bidding function comprise the basic elements of generation companies; the demand curve and pricing rules of ISO determine basic surviving conditions of generation companies; the assumption of fixed pricing rules determine interaction patterns between generation companies and ISO. The game analysis of the optimal pricing model is carried out in this article, with the gradual Cournot adjustment model designed. It simulates the Cournot adjustment in combination with typical cases to reveal those possible causes leading to instability of electricity markets and to arrive at the conclusion that the market power will strengthen gradually through the information feedback loop and may cause the instability of electric power markets.At last, this paper design the virtual action as the studying procedure of generation companies based on the theory of learning in games. From analysis of the survival environment of generation companies, we know that the generator's market power will be influenced by the market profits, information, feedback loops and information structure. In the case of incomplete information, the generator can develop the better bidding strategies by assuming of the opponent's environmental constraints curve. The price approximation method provides a reasonable way of learning for generation companies. In the long-term iterative process, the strategy of each generator is fed back through the signal of market to other generators and affect their bidding strategy through their opponents curve of environmental constraints. Through this feedbac, the market force will be strengthened or weakened. This procedure is very slow and gradual. It suggests that there may be a long process of accumulation of market power before eruption of the crisis of electricity markets.