Combined Simulation of Auction Revenue Rights Allocation and Financial Transmission Rights Auction for Electricity Markets

This research work presents an extension of a reputable agent-based open-source software for wholesale day-ahead energy auction to incorporate both financial transmission rights auction and auction revenue rights allocation. Simulation analysis of two different market scenarios was performed on a standard 5-bus test system. Auction revenue rights facilitate market participants to minimize their transmission management costs. Average of all participants’ costs effectively reduces to zero when financial transmission rights auction and auction revenue rights allocation are both allowed. The agent-based open-source software is well suited for adding more market features to facilitate future research and simulation of liberalized electricity markets.