Econometric Modeling of Regional Electricity Spot Prices in the Australian Market
Econometric Modeling of Regional Electricity Spot Prices in the Australian Market
Wholesale electricity markets are increasingly integrated via high voltage interconnectors, and inter-regional trade in electricity is growing. To model this, we consider a spatial equilibrium model of price formation, where constraints on inter-regional flows result in three distinct equilibria in prices. We use this to motivate an econometric model for …