Simulation of producers behaviour in the electricity market by evolutionary games

Abstract

Simulation of the electricity market participant's behaviour is important for producers and consumers to determine their bidding strategies and for regulating the market rules. In literature, for this aim a lot of papers suggest to use the well-known theory of non-cooperative games and the concept of Nash equilibrium. Unfortunately they cannot be applied in an easy way when a multi-players game has to be considered to simulate the operation of the electricity market. In this paper, the authors suggest to use the new theory of evolutionary games and the concept of near Nash equilibrium to simulate the electricity market in the presence of more than two producers. In particular, an opportune genetic algorithm has been developed; from the results reported in the paper, it is clear that this algorithm can be usefully utilised.