Game Theory Based Study On Bidding Strategy & Market Power Of Generation Company

With profound reform undergoing in electric market, the bidding strategy of the generation companies has been gaining prominence increasingly. Based on Game Theory, this thesis has put forward some research and analysis work on the above-mentioned issue.Facilitated by the economics and operational research method, with the help of decision tree and game theory, the bidding strategy of generation companies has been analyzed with additional evaluation on the impact of alliance of those companies. The relationships between the payoffs and competition mode between generation companies has been illustrated through quantitative case study.A Cournot model with technical constraint under incomplete information has been built in a assumed electric market with an elastic electric power demand, later on its Cournot-Nash equilibrium solution of the expected generation units output obtained. Hence the generation units' bidding curves can be evolved through certain transformation process. Stimulation has been done to draw comparisons between those game solutions stemmed from incomplete information and complete information.Game theory based approach has been elaborated on to mitigate the market power. Case study with analysis of complete information has been illustrated to improve the practicality of this approach.