marginal cost of suppliers. The leading example is the electricity industry, where there is a capacity market clearing before … the spot market. -- capacity market ; procurement auction ; electricity market ; competitive equilibrium …

Capacity constraints on transmissions of electricity are raising an increasing policy concern as electricity markets … this paper is to highlight the impact of transmission capacity constraints and transmission costs on electricity market …

We study two electricity markets connected by a fixed amount of crossborder capacity. The total amount of capacity is … known to all electricity traders and allocated via an auction. The capacity allocated to each bidder in the auction remains … private information. We assume that traders are faced with a demand function reflecting the relationship between electricity …

Initially created as afterthoughts to competitive electricity markets, capacity markets were intended to enhance system … reliability. They have evolved into massive, highly controversial, and poorly understood billion-dollar institutions. Electricity …