In a 'smart' electricity distribution network, flexible distribution resources (FDRs) can be coordinated to improve efficiency. But coordination enables whoever controls such resources to exercise market power. The paper establishes the following efficiency rankings of market structures:...

This article formally analyzes the causes of underinvestment in electric power generation, and the various corrective market designs that have been proposed and implemented. It yields four main analytical findings. First, using a simple numerical example, (a linear demand function, calibrated on...

I show that British electricity tariffs create substantial welfare loss, equivalent to between six and eighteen percent of domestic consumption value. Losses are greater than unpriced distributional and environmental counter effects. Expected technological change will increase this welfare loss....

An increasing reliance on solar and wind power has raised concern about system ability to consistently satisfy electricity demand. This paper examines countries' unilateral incentives to achieve supply security through capacity reserves and market integration in a multinational electricity...

Nodal pricing has emerged from a theoretical approach to a practicable and efficient tool for network and congestion mangement. Experiences from North America and New Zealand have proven nodal pricing to be workable without serious technical problems. Continental European electricity grids like...

This paper provides a detailed overview of the current state of scientific literature on the coordination of different agents in smart distribution systems. The coordination of agents can be market-driven or network-related. As an important market-driven measure, approaches that allow to reflect...

Adequately designed prices are essential to achieve efficient coordination between the electricity network and market participants. However, consumer prices comprise several, possibly distorting price components. In an analytical model, we examine different regulatory settings, consisting of...

We analyze the regulatory procurement of electricity infrastructure that can take the form of either a traditional core investment or non-traditional distributed energy resources (DERs). We identify conditions under which a regulated utility will engage in self-sabotage (i.e., intentionally...

Wholesale electricity markets use different market designs to handle congestion in the transmission network. We compare nodal, zonal and discriminatory pricing in general networks with transmission constraints and loop flows. We conclude that in large games with many producers who are allowed to...

We consider optional TOU (time-of-use) pricing for residential consumers as an alternative to a single TOU or flat rate structure offered by a publicly regulated electricity supplier. A general equilibrium model is developed and used to explore and quantify the effects of optional pricing on...