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It's important to note that in wholesale markets, regular market participants do NOT set their own prices. Assuming that you have the ability to generate power
by cosmic_quanta 2y ago
It's important to note that in wholesale markets, regular market participants do NOT set their own prices.
Assuming that you have the ability to generate power (e.g. you own a peaker plant), you submit offers effectively saying "I'm OK providing power for at least 20$/MWh, up to 100 MWh".
The market operator then solves a very complex optimization problem (called 'optimal power flow') which may result in power prices being very expensive in certain areas, due to transmission congestion.
- datadrivenangel 2y agoRight, it's a clever auction system! There's a lot of long-tail value/margin to be captured by VPPs right now, especially as wind and solar penetration increases. (The Enron people abused this with too much market share by taking power plants offline at times of high demand and doing shenanigans with transmission congestion.)