eprintid: 48168
rev_number: 10
eprint_status: archive
userid: 1482
importid: 105
dir: disk0/00/04/81/68
datestamp: 2023-09-25 10:17:33
lastmod: 2023-12-01 10:09:48
status_changed: 2023-12-01 10:09:48
type: monograph
metadata_visibility: show
creators_name: Willems, Bert
creators_name: Yueting, Yu
creators_idrefppn: 245415939
creators_affiliation: Toulouse School of Economics;Université Catholique de Louvain;Tilburg University
creators_halaffid: 1002422
title: Bidding and Investment in Wholesale Electricity Markets: Discriminatory versus Uniform-Price Auctions
ispublished: pub
subjects: subjects_ECO
abstract: We compare uniform and discriminatory-price auctions in wholesale electricity markets, studying both long-run investment incentives and short-run bidding behaviors. We develop a monopolistic competition model with a continuum of generation technologies ranging from base load to peak load, free entry and uncertain elastic demand. Our findings reveal that discriminatory-price auctions are inefficient because consumers’ willingness to pay exceeds the marginal costs and investment incentives are distorted. Despite having an equal total installed capacity, the generation mix under discriminatory-price auctions skews towards a shortage of base-load technologies. Consequently, this results in a lower long-run consumer surplus.
date: 2023-08
date_type: published
publisher: TSE Working Paper
official_url: http://tse-fr.eu/pub/128423
faculty: tse
divisions: tse
language: en
has_fulltext: TRUE
subjectsJEL: JEL_D44
subjectsJEL: JEL_L94
view_date_year: 2023
full_text_status: public
monograph_type: working_paper
series: TSE Working Paper
volume: 23-1462
place_of_pub: Toulouse
pages: 37
institution: Université Toulouse Capitole
department: Toulouse School of Economics
book_title: TSE Working Paper
oai_identifier: oai:tse-fr.eu:128423
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harvester_local_overwrite: creators_name
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harvester_local_overwrite: subjectsJEL
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oai_lastmod: 2023-11-30T08:15:08Z
oai_set: tse
site: ut1
citation:   Willems, Bert <https://www.idref.fr/245415939> and Yueting, Yu  (2023) Bidding and Investment in Wholesale Electricity Markets: Discriminatory versus Uniform-Price Auctions.  TSE Working Paper, n. 23-1462, Toulouse     
document_url: https://publications.ut-capitole.fr/id/eprint/48168/1/wp_tse_1462.pdf