| ID | 099233 |
| Title Proper | Efficient capacity investment and joint production agreements in an oligopolistic electricity market |
| Other Title Information | the HidroAysen joint venture project |
| Language | ENG |
| Author | Raineri, Ricardo ; Contreras, Gonzalo |
| Publication | 2010. |
| Summary / Abstract (Note) | We develop a model for a power market with the characteristics of the Chilean power supply industry, which is an integrated system with a system operator (SO) with a vast authority to define the dispatch of the system. We evaluate whether a large joint power generator project made up by the two largest power generators is an anti-competitive project. Considering four investment technologies for power generation, namely, hydro, coal, diesel, and an advantageous hydro technology which can only be built in a large scale (HidroAysén) for the joint venture case, we use an oligopolistic Cournot model and a Benevolent Social Planner, both calibrated to the Chilean power industry, in order to assess the efficiency of alternative investment strategies and conditions whether the HidroAysén joint venture project can be barred to be judged as anti-competitive. Results suggest that the joint venture is an efficient investment and there is a pro-competitive behaviour on the part of the two power generators, and that there are benefit to consumers, who should expect non-increasing energy prices as a result of the advantageous hydrotechnology. |
| `In' analytical Note | Energy Policy Vol. 38, No. 11; Nov 2010: p. 6551-6559 |
| Journal Source | Energy Policy Vol. 38, No. 11; Nov 2010: p. 6551-6559 |
| Key Words | Electricity Markets ; Game Theory ; Strategic Alliances |