A Diffusion-Model-Based Supply-Side Offer Agent

One-sided Markets for Energy | Thomas, Robert J.
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Hyungseon Oh and Robert J. Thomas
IEEE Transactions on Power Systems, Vol.21, No 4 (2006) pp. 1729-1735

World-wide energy markets have been on a path toward deregulation for several decades. These markets have proven to be difficult to design and run because of their repetitive nature and the externalities provided by reliable grid operation. In a deregulated market environment, our experiments suggest that market participants will pursue their own profit maximizing objective rather than use an objective that reflects social benefit. Multi-agent simulation is useful for gaining insights into market participant behavior under various rules. In this way market rules can be tested for efficacy and efficiency. In this paper an agent based on a double-layer diffusion model developed elsewhere [1] is tested and its effectiveness reported.