Impact of congestion on market power of GENCOs in deregulated electricity market.

This paper presents the quantitative analysis of market power of the Generation Companies (GENCOs) and the impact of congestion on it in the deregulated electricity market. The intensity of market power of the GENCOs has been obtained by making use of a novel Market Revenue Share (MRS) index. The MRS of a GENCO is defined as a revenue earned by it as a fraction of total market revenue of all the participating GENCOs in the deregulated electricity market during any specific time span. The MRS of GENCOs has been obtained by solving an optimal power flow problem for maximizing social welfare function subject to the non-linear operational and congestion constraints. From the present electricity market real studies, it is noticed that under congested system conditions, some costly generators can get chance to exercise market power in the deregulated environment. The effectiveness of the proposed methodology has been demonstrated on IEEE-30 bus test system. It has been observed that due to congestion, there is an increase in the value of MRS Index of some costly generators which implies that GENCOS's ability to exercise market power increases with congestion in the deregulated electricity market. [ABSTRACT FROM AUTHOR]