Did the introduction of a nodal market structure impact wholesale electricity prices in the Texas (ERCOT) market?

J. ZARNIKAU, Chi Keung WOO, R. BALDICK

Research output: Contribution to journalArticles

21 Citations (Scopus)

Abstract

Regression analysis suggests that zonal averages of locational marginal prices under the nodal market are about 2 % lower than the balancing energy prices that would occur under the previous zonal market structure in ERCOT. The estimates for the nodal market price effects are found after controlling for such factors as natural gas prices, total system load levels, non-dispatchable generation levels, the treatment of local congestion costs, and the treatment of the revenues received by the market from the auctioning of transmission rights. Our finding is limited to periods which are not characterized by price spikes in the wholesale market. Copyright © 2014 Springer Science+Business Media New York.
Original languageEnglish
Pages (from-to)194-208
JournalJournal of Regulatory Economics
Volume45
Issue number2
DOIs
Publication statusPublished - 2014

Citation

Zarnikau, J., Woo, C. K., & Baldick, R. (2014). Did the introduction of a nodal market structure impact wholesale electricity prices in the Texas (ERCOT) market? Journal of Regulatory Economics, 45(2), 194-208. doi: 10.1007/s11149-013-9240-9

Keywords

  • Electricity market restructuring
  • Deregulation
  • Locational marginal pricing
  • ERCOT

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