Sequential time-step generation companies decisions in oligopolistic electricity market

Generation companies decision-making modeling by linear control theory

“…Table 3 shows that Scenario 1 presents the lowest price and the highest market quantity which is the result of adjusting coefficients values. Since the adjusting coefficients, moves in the same direction, both tend to 1, and the market equilibrium moves to perfect competition [15]. On the other hand, as discussed in the case above, the effect of quadratic production cost in market equilibrium will be an increase in price resulting in a decreasing market total quantity.…”

“…The traditional Cournot equilibrium is achieved when both coefficients are 0. Any other combination of adjusting coefficients will fall between monopoly and perfect competition models, and eventually one GENCO will act as leader in the market, and will still reach the standard Nash equilibrium [15]. Table 4 shows the market equilibrium under different conditions when both GENCOs have adaptive expectations.…”