Market Power Analysis for the Turkish Electricity Market

Abstract

The market power problem in Turkish Electricity Market is addressed in this study. The study includes a comprehensive study of detecting market power in Turkish Electricity Market. After shortly reviewing definitions and strategies of detecting market power in literature, methods of detecting market power that have not been employed yet by academics or market monitors/regulators for Turkish Electricity Market will be examined. Even if the traditional measures of market power which are market share and Herfindahl-Hirschman Index (HHI) are used to analyze the market by Turkish market regulators and academicians, a comprehensive study about the potential of market power in Turkish Electricity Market has not been studied yet. Also, more suitable index which is Residual Supplier Index (RSI) is never taken into account in the literature for Turkish Electricity Market. These indexes of market power are calculated by using both of the available capacities and the electricity produced in the market which are publicly found on the transparency platform of Energy Exchange Istanbul (EXIST). The values of these indices will be calculated for consecutive years and market power potential and market competitiveness of Turkish Electricity Market over the years will be determined.