The role of demand response in mitigating market power: a quantitative analysis using a stochastic market equilibrium model

Market power is a dominant feature of many modern electricity markets with an oligopolistic structure, resulting in increased consumer cost. This work investigates how consumers, through demand response (DR), can mitigate against market power. Within DR, our analysis particularly focusses on the impacts load shifting and self-generation. A stochastic mixed complementarity problem presented to model characterised by oligopoly competitive fringe. It incorporates both energy capacity markets, multiple generating firms different types. The applied case study based data for Irish system. results demonstrate DR help consumers negative effects that self-generation are competing technologies, whose effectiveness similar most consumers. We also find does not necessarily reduce emissions presence