A simple method for locational market power screening

Abstract

The existing New England electricity market follows a uniform pricing system: infra-marginal generators are paid a uniform clearing price while constrained-on generators are paid bid prices subject to a locational market power screen. In this paper, we first report the operation experience of this approach during the period from May 1999 through July 2000. We then briefly review the NEPOOL locational pricing proposal to be fully implemented in late 2001. Two new approaches for locational market power screening are presented. The first one is based on a zonal network model, the second based on a nodal transmission model. Test results of both approaches are included.