Study On The Strategic Bidding Of Generations In Electricity Market

Based the investigation and operation of electricity market and national electrical industry, this paper deeply studies and analyzes the electricity bidding mechanism in electricity market, and electricity generation bidding behavior.At first, this paper clarifies the definition of electricity market and its requirements, analyzes the characteristics of a real electricity market. In detail, we discuss the factors that have great influence upon the boom of restructuring electrical power industry internationally, and describe different feasible schemes of electricity market, which were proposed and practically applied in recent years.Secondly, it is the prerequisite for constructing new electricity that the monopolized and integrated electricity scheme should be changed. To setup the electricity market and its competition mechanism is necessary as the result. This paper analyzes the monopoly characteristics of electrical power industry in detail. Based on these theoretical analysis and investigation about the reform of different countries, we outline the characteristics of the reform of electrical power industry, and its trend.Reviewing in detail the whole restructuring progress of electrical power industry in China, this paper concludes that in china, electrical power market should be reformed creatively and stably, under the direction of government and the regulation of the relative laws.Generation and electricity grid are operated in vertically integrated monopoly in existing situation. Comparatively, in the new electricity market, the generation and the electricity grid will be separated from each other under the regulation. Generation may face the market directly. How will generation deal with the future competition and improve their competitive power in the future market. To some extent, this paper will try to answer this question. Based on case study, we also bring forward the optional solution for the generation according to the theory of strategy management, including differentiating investment, accepting strategic capital, setting up strategic alliance and operation internationalization.Because of incomplete information and market power, the market is oligopoly naturally. To deconstruct the monopoly, demand-side competition will be first introduced into electrical power market. In generation market, price bidding will be thefundamental solution to improve the competition by and large.In a competitive electricity market, the operational target of generations is to maximizing their owner profits. After studying the generation market and the generation's behaviors in the market, this paper introduces the HHI indicator to evaluate the monopoly situation, and the competitive status of generation. On this basis, we deeply studies generation bidding behavior and its strategy. Moreover, we analyze the basic bidding mechanism in electricity industry. Finally, we proposed some optional pricing strategies of generation.