Cross-border electricity market model (BEM)

The BEM model complements the energy-system models of the Energy Economics Group by a more detailed market model to improve the representation of market price levels and welfare impacts.

The BEM model can consider electricity, natural gas and (prospective) hydrogen markets, by using a game-theoretic modelling of market participants, to allow to analyze the investment and market behavior of energy suppliers in Switzerland and its surrounding countries.


BEM overview

A main feature of the model is the calibration to today's price levels by using a conjectural variation model, where the players are country-regions (in the base-version).

Currently, the base-version of the BEM model has the following characteristics:

  • Equilibrium market models of Nash-Cournot type
  • Operational time resolution: 1 year divided in 4 seasons with a representative day with 24 hourly load-periods (extendable to 8760h for special requirements)
  • Geographical scope: Regions: Switzerland, Germany, France, Italy, Austria
  • Markets: Electricity, Natural gas, (prospective hydrogen market)
  • Transmission constraints between regions 
  • Possibility of endogenous investment decisions (base-version: single-step).
  • Possibility of non-linear demand curves

The model is written in GAMS, with input-data and solve-results in MS Excel.

BEM market coupling

Wan Y, Kober T, Schildhauer T, Schmidt TJ, McKenna R, Densing M (2023). Conditions for profitable operation of P2X energy hubs to meet local demand under to with energy market access. Advances in Applied Energy. 2023; 10: 100127 (16 pp.). https://doi.org/10.1016/j.adapen.2023.100127

Densing M, Wan Y (2022). Low-dimensional scenario generation method of solar and wind availability for representative days in energy modeling. Applied Energy. 2022; 306(B): 118075 (17 pp.). https://doi.org/10.1016/j.apenergy.2021.118075

Wan Y, Kober T, Densing M (2022). Nonlinear inverse demand curves in electricity market modeling. Energy Economics. 2022; 107: 105809 (9 pp.).https://doi.org/10.1016/j.eneco.2022.105809

Keles, D., Densing, M., Panos, E., Hack, F., Joris, D. (2020). Cross-border Effects in Interconnected Electricity Markets - An Analysis of the Swiss Electricity Prices, Energy Economics, 90, pp. 104802. https://doi.org/10.1016/j.eneco.2020.104802

Panos, E., Densing, M. (2019). The future developments of the electricity prices in view of the implementation of the Paris Agreements: Will the current trends prevail, or a reversal is ahead? Energy Economics, 84, pp. 104476. https://doi.org/10.1016/j.eneco.2019.104476

Panos, E., Densing, M., Schmedders, K. (2017). Oligopolistic capacity expansion with subsequent market-bidding under transmission constraints (OCESM), Report of SFOE-EWG Research Programme Alternative download (ZORA Archive of University of Zurich): DOI: 10.5167/uzh-151127
 

Wan, Y., Kober, T., McKenna, R., Densing, M. (2024). Market effects of Power-to-Gas technologies and their role under future gas supply shocks using a coupled electricity-gas-hydrogen market model. 33th European Conference on Operational Research (EURO 2024), 30 June- 3 July, Copenhagen, Denmark

Densing, M., Wan, Y. (2023). Aggregation of intermittent renewables in energy market models: capturing correlations and extreme events. 18th IAEE European conference, 24-27 July, Milano, Italy Download

Wan, Y., Densing, M. (2019). Non-Linear Demand Curves in Electricity Markets: Impact on Market Power Estimation.  16th European IAEE Conference, 25-28 Aug, Lubliana.  https://iaee2019ljubljana.oyco.eu/download/contribution/abstract/226/226_abstract_20190315_145537.docx

Panos, E., Densing, M. (2018). The future development of the electricity prices in view of the implementation of the Paris Agreements in 2030: will the current trends prevail or reverse is ahead?, The 37th International Energy Workshop, Gothenburg, Sweden, 19-21 June 2018, Download Presentation

Densing, M., Panos, E. (2018). Electricity Market Prices under Long-Term Policy Scenarios, 41st International Association of Energy Economics (IAEE) International conference, Groningen, Netherlands, 10-13 June 2018, Download Presentation

Kober, T., Panos, E., Densing, M. Kannan, R. (2018). Zukünftige Rolle der Schweizer Wasserkraft im Gesamtenergiesystem, VSE Fachtagung “Zukunft der Wasserkraft", Olten, 27. June 2018, Program

Densing, M. (2017). Modeling of electricity markets and hydropower dispatch, SCCER - Supply of Electricity Annual Conference, Birmensdorf, Switzerland, 14-15 September 2017, Download Presentation

Densing, M., Panos, E., Schmedders K. (2017). Stochastic bi-level electricity market modeling, 2nd Workshop of SET-Nav WP10 Modelling Forum - Modelling of Risk and Uncertainty in Energy System, ETH, Zürich, Switzerland

Densing, M., Panos, E., Schmedders, K. (2015). Decision making in electricity markets: Bi-level games and stochastic programming, Energy Science Center Workshop, ETH Zurich, Switzerland, Presentation

Densing, M., Panos, E., Schmedders, K. (2015). Bilevel oligopolistic electricity market models: The case of Switzerland and surrounding countries, OR2015, Annual International Conference of the German Operations Research Society, Vienna, Austria

Densing M. (2015). Stochastic programming formulations of coherent multi-period risk measurement, 13th Swiss Operations Research Days, IBM Research, Zurich