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Inflow Uncertainty in Hydropower Markets
Author(s) -
Vegard Hansen Petter
Publication year - 2009
Publication title -
scandinavian journal of economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.725
H-Index - 64
eISSN - 1467-9442
pISSN - 0347-0520
DOI - 10.1111/j.1467-9442.2008.01559.x
Subject(s) - hydropower , economics , inflow , microeconomics , market power , electricity market , econometrics , industrial organization , electricity , engineering , physics , mechanics , electrical engineering , monopoly
We analyse the effects of uncertainty on market performance in hydropower systems under alternative assumptions about market structure. Uncertainty creates distinct possibilities for exercising market power that cannot be captured in deterministic models. The qualitative and quantitative features of these possibilities depend on the characteristics of residual demand facing individual firms, which again depends on consumer preferences and generation and transmission technologies.