Spillovers from ancillary services to wholesale energy markets.

In electricity markets, generators are rewarded for providing energy and for enabling grid reliability. The two functions are compensated separately: with energy market payments and ancillary services market payments. We provide evidence of changes in the generation mix in the energy market that are...

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Publicado en:RAND Journal of Economics (Wiley-Blackwell) Vol. 55; no. 1; pp. 87 - 112
Autores principales: Buchsbaum, Jesse, Hausman, Catherine, Mathieu, Johanna L, Peng, Jing
Formato: Artículo
Publicado: Wiley-Blackwell Mar2024
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Acceso en línea:Ver este registro en EBSCOhost
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        atl: Spillovers from ancillary services to wholesale energy markets.
      aug:
        au:
          Buchsbaum, Jesse
          Hausman, Catherine
          Mathieu, Johanna L
          Peng, Jing
        affil:
          Energy & Environmental Lab, University of Chicago, Chicago IL, 60602,, United States
          Gerald R. Ford School of Public Policy, University of Michigan, Ann Arbor, United States
          Electrical Engineering and Computer Science, University of Michigan, Ann Arbor, United States
      su:
        Energy industries
        Electricity markets
        Power plants
        Wholesale trade
      sug:
        subj:
          Power and Communication Line and Related Structures Construction
          Wholesale Trade Agents and Brokers
          Wholesale trade agents and brokers
          Energy industries
          Electricity markets
          Power plants
          Wholesale trade
      ab: In electricity markets, generators are rewarded for providing energy and for enabling grid reliability. The two functions are compensated separately: with energy market payments and ancillary services market payments. We provide evidence of changes in the generation mix in the energy market that are driven by exogenous changes in an ancillary services market. We provide a theoretical framework and quasi‐experimental evidence for understanding the mechanism: it results from the multi‐product nature of power plants combined with discontinuities in costs. Although much research focuses solely on the energy market, our results suggest that spillovers between the two markets are important.
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    language: English
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