– Explains how short-run reliability policies directly impact long-run investment in generation capacity, focusing on why power systems often under-invest without regulatory intervention.
– Covers locational marginal pricing (LMP), transmission rights, and the costs of pricing losses. Key Insights and "Fallacies" power system economics steven stoft pdf
– Provides a deep dive into the exercise of market power, price spikes, and prediction tools like the Lerner index and HHI . – Introduces the fundamentals of microeconomics
– Introduces the fundamentals of microeconomics, engineering, and the distinction between market structure (reliability, demand elasticity) and market architecture (bilateral vs. pool markets). power system economics steven stoft pdf
The book is structured into five distinct parts that systematically bridge the gap between abstract economic theory and the physical reality of power grids:
– Examines classic day-ahead and real-time market models, including the mechanics of PJM Interconnection .