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1 – 10 of over 2000Zhongfu Tan, Chengwen Wang, Guangjuan Chen, Jing Su and Li Li
The purpose of this paper is to study the influence of different trade modes on the electricity market.
Abstract
Purpose
The purpose of this paper is to study the influence of different trade modes on the electricity market.
Design/methodology/approach
A linear model between power units' output and their bidding prices is presented and optimal models to minimize the purchase power cost of power grid companies are presented, applying static games and dynamic games, respectively. Then the relation between power generation amount and units' bidding price is settled by using difference methods. In addition, optimization models are established to optimize profits of units at discriminatory bidding or uniform marginal price applying static game and dynamic game. Finally, the economic benefits and fair competition are compared and analyzed.
Findings
If impartiality is emphasized, the detailed history bidding information should not be opened. Also, it is fairer but difficult to control units' speculative behavior at uniform marginal price.
Research limitations/implications
A supposition has been made that all participants are rational.
Practical implications
The paper presents useful advice for improving the trade mode of the electricity market.
Originality/value
Power units' bidding models and strategies are presented at discriminatory bidding price or at uniform marginal price applying non‐cooperation static game and dynamic game, respectively.
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Yadong Dou, Xiaolong Zhang and Ling Chen
The coal-fired power plants have been confronted with new operation challenge since the unified carbon trading market was launched in China. To make the optimal decision for the…
Abstract
Purpose
The coal-fired power plants have been confronted with new operation challenge since the unified carbon trading market was launched in China. To make the optimal decision for the carbon emissions and power production has already been an important subject for the plants. Most of the previous studies only considered the market prices of electricity and coal to optimize the generation plan. However, with the opening of the carbon trading market, carbon emission has become a restrictive factor for power generation. By introducing the carbon-reduction target in the production decision, this study aims to achieve both the environmental and economic benefits for the coal-fired power plants to positively deal with the operational pressure.
Design/methodology/approach
A dynamic optimization approach with both long- and short-term decisions was proposed in this study to control the carbon emissions and power production. First, the operation rules of carbon, electricity and coal markets are analyzed, and a two-step decision-making algorithm for annual and weekly production is presented. Second, a production profit model based on engineering constraints is established, and a greedy heuristics algorithm is applied in the Gurobi solver to obtain the amounts of weekly carbon emission, power generation and coal purchasing. Finally, an example analysis is carried out with five generators of a coal-fired power plant for illustration.
Findings
The results show that the joint information of the multiple markets of carbon, electricity and coal determines the real profitability of power production, which can assist the plants to optimize their production and increase the profits. The case analyses demonstrate that the carbon emission is reduced by 2.89% according to the authors’ method, while the annual profit is improved by 1.55%.
Practical implications
As an important power producer and high carbon emitter, coal-fired power plants should actively participate in the carbon market. Rather than trade blindly at the end of the agreement period, they should deeply associate the prices of carbon, electricity and coal together and realize optimal management of carbon emission and production decision efficiently.
Originality/value
This paper offers an effective method for the coal-fired power plant, which is struggling to survive, to manage its carbon emission and power production optimally.
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Zhenning Zhu, Lingcheng Kong, Gulizhaer Aisaiti, Mingzhen Song and Zefeng Mi
In the hybrid electricity market consisting of renewable and conventional energy, the generation output of renewable power is uncertain because of its intermittency, and the power…
Abstract
Purpose
In the hybrid electricity market consisting of renewable and conventional energy, the generation output of renewable power is uncertain because of its intermittency, and the power market demand is also fluctuant. Meanwhile, there is fierce competition among power producers in the power supply market and retailers in the demand market after deregulation, which increases the difficulty of renewable energy power grid-connection. To promote grid-connection of renewable energy power in the hybrid electricity market, the authors construct different contract decision-making models in the “many-to-many” hybrid power supply chain to explore the pricing strategy of renewable energy power grid-connecting.
Design/methodology/approach
Considering the dual-uncertainty of renewable energy power output and electricity market demand, the authors construct different decision-making models of wholesale price contract and revenue-sharing contract to compare and optimize grid-connecting pricing, respectively, to maximize the profits of different participants in the hybrid power supply chain. Besides, the authors set different parameters in the models to explore the influence of competition intensity, government subsidies, etc. on power pricing. Then, a numerical simulation is carried out, they verify the existence of the equilibrium solutions satisfying the supply chain coordination, compare the differences of pricing contracts and further analyze the variation characteristics of optimal contract parameters and their interaction relations.
Findings
Revenue-sharing contract can increase the quantity of green power grid-connection and realize benefits Pareto improvement of all parties in hybrid power supply chain. The competition intensity both of power supply and demand market will have an impact on the sharing ratio, and the increase of competition intensity results in a reduction of power supply chain coordination pressure. The power contract price, spot price and selling price have all been reduced with the increase of the sharing ratio, and the price of renewable power is more sensitive to the ratio change. The sharing ratio shows a downward trend with the increase of government green power subsidies.
Originality/value
On the basis of expanding the definition of hybrid power market and the theory of newsvendor model, considering the dual-uncertainty of green power generation output and electricity market demand, this paper builds and compares different contract decision-making models to study the grid-connection pricing strategy of renewable energy power. And as an extension of supply chain structure types and management, the authors build a “many-to-many” power supply chain structure model and analyze the impact of competition intensity among power enterprises and the government subsidy on the power grid-connecting pricing.
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S.N. Singh, D. Saxena and Jacob Østergaard
Besides organizational changes in the electricity supply industry there are growing concerns about environmental issues derived from the Kyoto Protocol for the reduction of…
Abstract
Purpose
Besides organizational changes in the electricity supply industry there are growing concerns about environmental issues derived from the Kyoto Protocol for the reduction of greenhouse gas emissions as well as promoting renewable energies. The purpose of this paper is to address the source side emission trading impact on electricity prices in the competitive power market.
Design/methodology/approach
Various schemes are suggested and are being implemented to achieve this objective. It is expected that electricity price will increase due to imposition of emission taxes. This paper analyzes the impact of electricity prices in the competitive electricity markets having a uniform market clearing price mechanism.
Findings
It is found that the electricity prices depend on the system loading, generation mix, etc. at a particular hour. Various emission trading instruments are discussed with a special emphasis on the European market.
Research limitations/implications
Block bidding of the suppliers is considered whereas the demand is assumed to be inelastic.
Originality/value
The emission trading impacts are analyzed on a simple example.
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The purpose of this study is to propose a decentralized multi-party cross-trading scheme based on a certificate transaction mechanism for the transaction of excess consumption…
Abstract
Purpose
The purpose of this study is to propose a decentralized multi-party cross-trading scheme based on a certificate transaction mechanism for the transaction of excess consumption certificates (ECCs) of renewable energy. The aim is to address the problems associated with the existing centralized transaction mode and to promote the development of the green electricity industry.
Design/methodology/approach
The proposed scheme involves calculating the quotation difference for the same type of certificate transaction based on the quotations of all users of both buyers and sellers. The transaction volume is then determined based on the order of quotation difference from large to small, and the total interests of cooperation are calculated. The nucleolus method is adopted to allocate the total interests to each member of the alliance and calculate the final transaction price. The blockchain technology is used for the transaction to achieve accurate traceability and efficient supervision, and a corresponding smart contract is designed and simulated in the Ethereum consortium chain.
Findings
The results of the simulation show the rationality and effectiveness of the proposed scheme. The decentralized multi-party cross-trading scheme can overcome the problems associated with the existing centralized transaction mode, such as low transaction efficiency, difficulty in obtaining the optimal transaction strategy and efficient supervision. The proposed scheme can promote the development of the green electricity industry by stimulating users' demand potential for green electricity.
Originality/value
The proposed scheme is original in its use of a certificate transaction mechanism to facilitate the trading of ECCs of renewable energy. The scheme adopts a decentralized multi-party cross-trading approach that overcomes the problems associated with the existing centralized transaction mode. The use of the nucleolus method for the allocation of total interests to each member of the alliance is also original. Finally, the use of blockchain technology for accurate traceability and efficient supervision of the transaction is an original contribution to the field.
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This chapter focuses on the common occurrence of wholesale electricity prices that fall below the cost of production. This “negative pricing” in effect represents payment to…
Abstract
This chapter focuses on the common occurrence of wholesale electricity prices that fall below the cost of production. This “negative pricing” in effect represents payment to high-volume consumers for taking excess power off the grid, thus relieving overload. Occurrences of negative pricing have been observed since the wholesale electricity markets have been operating, and occur during periods of low demand, while generators are being kept in reserve for rapid engagement when demand increases (it is expensive and time-consuming to shut down generators and then restart them, so they are often kept in “spooling mode”). In such situations power production may temporarily exceed demand, potentially overloading the system. When the federal government began subsidizing the construction of wind generation projects, with regulations in place requiring transmission grids to accept all of the electricity produced by the wind generators, negative pricing became more frequent.
Paul Nayaga, Frank Adusah-Poku, John Bosco Dramani and Paul Owusu Takyi
The quest for economic development has brought adverse effects on the environment through the release of greenhouse gases, such as carbon dioxide (CO2). This will counter the…
Abstract
Purpose
The quest for economic development has brought adverse effects on the environment through the release of greenhouse gases, such as carbon dioxide (CO2). This will counter the efforts to achieve the Sustainable Development Goals (SDGs) by 2030. This study, therefore, investigates the effect of electricity consumption and urbanization on CO2 emissions in Ghana. Electricity consumption and urbanization are among the factors that can be used to reduce CO2 emissions.
Design/methodology/approach
Following the STIRPAT framework with the Hansen (2000) least squares threshold estimation strategy, the study employed annual time series data from 1971 to 2019.
Findings
The study revealed a single threshold effect of both electricity consumption and urbanization on CO2 emissions. Electricity consumption intensity reduces CO2 emission when electricity consumption is below the threshold (6287GWh) but increases when consumption passes the threshold. However, urbanization exerts a positive influence on CO2 emissions regardless the level of urbanization (either before or after the threshold point). Again, the empirical results revealed that the urbanization threshold moderates the effect of electricity consumption on CO2 emissions.
Research limitations/implications
Policymakers have to consider redesigning the current urbanization mode to include some new-type urbanization elements.
Originality/value
The threshold effect of electricity consumption and urbanization on CO2 emissions in Ghana is examined using the Hansen (2000) least square method.
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Weiwei Li, Jin-Lou Zhao, Linxiao Dong and Chong Wu
Long-term contract is an important developing direction of China's coal industry coordination. This paper aims to discuss how to use contract for difference (CFD) to avoid risk…
Abstract
Purpose
Long-term contract is an important developing direction of China's coal industry coordination. This paper aims to discuss how to use contract for difference (CFD) to avoid risk and effectively increase the benefit of both coal and thermal power plants in the coal-electricity supply chain.
Design/methodology/approach
Based on prospect theory, this paper takes the risks and benefits of the coal and coal-fired power plants in the coal supply chain under CFD into balanced consideration to construct the contract coordination mechanism. In this mechanism, the coal demand in the coal supply chain equilibrium under centralized decision-making is regarded as the total annual volume of transactions needed to design the contract coordination mechanism and solve double marginalization. Then, based on prospect theory, in the construction of CFD, this paper takes the income of power and coal enterprises when they are in equilibrium under Stackelberg non-cooperative game as the reference point. In addition, considering that coal demand is a random variable, the CFD with a one-year trading session can be designed.
Findings
The research derives the coal price of the contract for difference, contract trading volume and its proportion of the total trading volume. A numerical example shows that the model above can be used to effectively avoid the risk of both coal and electricity sides.
Originality/value
To solve the conflict between coal enterprises and thermal power plants, let the coal-electricity supply chain be converted from non-cooperative game to cooperative game. Based on the prospect theory, this paper takes the income of the non-cooperative game of coal and thermal power plants as a reference point and considers how to design the coordination mechanism, the contract for difference, so as to make the two parties cooperate to solve the double marginal utility of the non-cooperative game in a chain supply. The main innovation of the work lies in the following: first, the coal demand when the coal-electrical supply chain is in balance under centralized decision-making is taken as the total annual trading volume needed to design the contract coordination mechanism and solve double marginalization. Second, based on prospect theory, in the construction of CFD, the benefits of coal-fired power plants and coal enterprises when both sides are in equilibrium under the Stackelberg non-cooperative game are taken as the reference points, and coal demand is taken as a random variable to design the CFD with a one-year transaction period. The price of coal that is not traded through CFD is calculated according to the daily market price. Third, this paper proposes the prospect M-V criterion of the risk-benefit equilibrium of both power and coal enterprises, which means that the risk-benefit equilibrium of both sides is the prospect variance effect of both sides relative to the reference point benefit divided by the prospect expectation effect.
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In this paper, I demonstrate an alternative explanation to the development of the American electricity industry. I propose a social embeddedness approach (Granovetter, 1985, 1992…
Abstract
In this paper, I demonstrate an alternative explanation to the development of the American electricity industry. I propose a social embeddedness approach (Granovetter, 1985, 1992) to interpret why the American electricity industry appears the way it does today, and start by addressing the following questions: Why is the generating dynamo located in well‐connected central stations rather than in isolated stations? Why does not every manufacturing firm, hospital, school, or even household operate its own generating equipment? Why do we use incandescent lamps rather than arc lamps or gas lamps for lighting? At the end of the nineteenth century, the first era of the electricity industry, all these technical as well as organizational forms were indeed possible alternatives. The centralized systems we see today comprise integrated, urban, central station firms which produce and sell electricity to users within a monopolized territory. Yet there were visions of a more decentralized electricity industry. For instance, a geographically decentralized system might have dispersed small systems based around an isolated or neighborhood generating dynamo; or a functionally decentralized system which included firms solely generating and transmitting the power, and selling the power to locally‐owned distribution firms (McGuire, Granovetter, and Schwartz, forthcoming). Similarly, the incandescent lamp was not the only illuminating device available at that time. The arc lamp was more suitable for large‐space lighting than incandescent lamps; and the second‐generation gas lamp ‐ Welsbach mantle lamp ‐ was much cheaper than the incandescent electric light and nearly as good in quality (Passer, 1953:196–197).
Purpose – The shipping industry is generally recognised as having better fuel efficiency than other transport modes. In many regions of the world, therefore, policy has promoted…
Abstract
Purpose – The shipping industry is generally recognised as having better fuel efficiency than other transport modes. In many regions of the world, therefore, policy has promoted shipping as the preferred freight transport mode of choice. In recent years, however, environmental problems associated with shipping have emerged. Several influential analyses have revealed the impact of shipping on air quality, particularly in the form of emissions of sulphur, nitrogen oxides and particulate matter, all of which have adverse consequences for human health.
Methodology/approach – An extensive environmental profile of shipping is provided, focusing specifically on the atmospheric pollution that is directly attributable to shipping operations.
Findings – It is important, however, to place the environmental profile of the shipping industry into the context of exactly how much transport work it does. This makes it clear that where shipping is a viable modal alternative then, in relative terms and most contexts, it still retains significant environmental advantages over other modes. The industry and its regulators have been slow, however, to improve its environmental profile and maintain its inherent advantage. Technical and operational measures which the industry may implement unilaterally are analysed, but these are deemed insufficient to stem the adverse tide of environmental concerns. Regulation is a necessity. Recently implemented regulatory measures are analysed, together with possible scenarios for the future regulation of greenhouse gas emissions. The IMO approach of global regulation is supported in preference to regionally based regulatory policies. There is also a danger that regulatory intervention may distort mode choice contexts.
Originality/value – The provision of an extensive environmental profile of shipping and an examination of this profile in relation to the importance of this transport mode to the global economy.