Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/200102 
Year of Publication: 
2017
Citation: 
[Journal:] Utilities Policy [ISSN:] 0957-1787 [Volume:] 46 [Publisher:] Elsevier [Place:] Amsterdam [Year:] 2017 [Pages:] 33-47
Publisher: 
Elsevier, Amsterdam
Abstract: 
The cross-border effects of a capacity market and a strategic reserve in interconnected electricity markets are modeled using an agent-based modeling methodology. Both capacity mechanisms improve the security of supply and reduce consumer costs. Our results indicate that interconnections do not affect the effectiveness of a capacity market, while a strategic reserve is affected negatively. The neighboring zone may free ride on the security of supply provided by the zone implementing a capacity mechanism. However, a capacity market causes crowding out of generators in the energy-only zone. A strategic reserve implemented by this region could aid in mitigating this risk.
Subjects: 
Capacity market
Cross-border effect
Strategic reserve
Persistent Identifier of the first edition: 
Creative Commons License: 
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Document Type: 
Article
Document Version: 
Published Version

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