Exploring the Vickrey-Clarke-Groves Mechanism for Electricity Markets
نویسندگان
چکیده
Control reserves are power generation or consumption entities that ensure balance of supply and demand of electricity in real-time. In many countries, they are procured through a market mechanism in which entities provide bids. The system operator determines the accepted bids based on an optimization algorithm. We develop the Vickrey-Clarke-Groves (VCG) mechanism for these electricity markets. We show that all advantages of the VCG mechanism including incentive compatibility of the equilibria and efficiency of the outcome can be guaranteed in these markets. Furthermore, we derive conditions to ensure collusion and shill bidding are not profitable. Our results are verified with numerical examples.
منابع مشابه
Exploring Vickrey-Clarke-Groves Mechanism for Electricity Markets
Control reserves are power generation or consumption entities that ensure balance of supply and demand of electricity in real-time. In many countries, they are operated through a market mechanism in which entities provide bids. The system operator determines the accepted bids based on an optimization algorithm. We develop the Vickrey-Clarke-Groves (VCG) mechanism for these electricity markets. ...
متن کاملAuctions for Procuring Options
We examine the mechanism design problem for a single buyer to procure purchase-options for a homogeneous good when that buyer is required to satisfy an unknown future demand. Suppliers have 2dimensional types in the form of commitment costs and production costs. The efficient schedule of options depends on the distribution of demand. To implement an efficient outcome, we introduce a class of me...
متن کاملExploiting Weak Supermodularity for Coalition-Proof Mechanisms
Under the incentive-compatible Vickrey-Clarke-Groves mechanism, coalitions of participants can influence the auction outcome to obtain higher collective profit. These manipulations were proven to be eliminated if and only if the market objective is supermodular. Nevertheless, several auctions do not satisfy the stringent conditions for supermodularity. These auctions include electricity markets...
متن کاملWeb Service-based Applications for Electronic Labor Markets: A Multi-dimensional Price VCG Auction with Individual Utilities
We design an efficient and transaction cost reducing Vickrey-Clarke-Groves auction as part of a web service for the work allocation problem in temporary employment agencies. In this auction bids are work contracts with multidimensional salaries. To compute the allocation we assume that every temporary employment worker conveys a utility function specifying the utility gained from working a give...
متن کاملMechanism Design Approach for Energy Efficiency
In this work we deploy a mechanism design approach for allocating a divisible commodity (electricity in our example) among consumers. We consider each consumer with an associated personal valuation function of the energy resource during a certain time interval. We aim to select the optimal consumption profile for every user avoiding consumption peaks when the total required energy could exceed ...
متن کامل