Do wind power producers have market power and exercise it?

Abstract

In most electricity markets, wind power producers can participant in real-time markets without the need of being committed in the day-ahead. This setup could potentially lead to market power of these producers as the penetration of wind increases. In this paper, we developed a theoretical framework to measure the ability and willingness of wind power producers in manipulating the market price. Through a case study of the ERCOT control area, we demonstrate these producers do posses market power even at relatively low penetrations.