Weinvestigatewhethertheremightexistsomerelationshipbetweenexerciseofdemandmarketpower and renewableenergysources,intheItaliandayaheadelectricitymarket,usingexanteindividualbids, in 2010–2011.Wechoosethisperiodbecausewedeemthatistheinitialperiodofboomingrenewable energy sourcesinItaly.Wemeasuremarketpowerwiththeinverseofthehourlyresidualsupply elasticity.Usageofbiddataisanoveltyintheliterature,aspreviousstudieshaveusedexpost-market data. Weconsiderthe five mainoperatorsandwedemonstratethatthereexistsdemandmarketpower, which canbeempiricallymeasuredonaverageabout3–5% (statisticallysignificant) in2010,andhigher, about 5–6%, inthe2011.Asregardofthehours,wecan find thattheoligopsonymarketpowerishigher during dailyhoursthaninthenightlyhours.Weshowthatthiseffectissignificantly morepronounced during periodswhenthereisabundanceofrenewablesupplyinthemarket
Demand Market Power and Renewables in the Italian Electricity Market
BIGERNA, SIMONA;BOLLINO, Carlo Andrea
2016
Abstract
Weinvestigatewhethertheremightexistsomerelationshipbetweenexerciseofdemandmarketpower and renewableenergysources,intheItaliandayaheadelectricitymarket,usingexanteindividualbids, in 2010–2011.Wechoosethisperiodbecausewedeemthatistheinitialperiodofboomingrenewable energy sourcesinItaly.Wemeasuremarketpowerwiththeinverseofthehourlyresidualsupply elasticity.Usageofbiddataisanoveltyintheliterature,aspreviousstudieshaveusedexpost-market data. Weconsiderthe five mainoperatorsandwedemonstratethatthereexistsdemandmarketpower, which canbeempiricallymeasuredonaverageabout3–5% (statisticallysignificant) in2010,andhigher, about 5–6%, inthe2011.Asregardofthehours,wecan find thattheoligopsonymarketpowerishigher during dailyhoursthaninthenightlyhours.Weshowthatthiseffectissignificantly morepronounced during periodswhenthereisabundanceofrenewablesupplyinthemarketI documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
