A Control Theorist's Perspective on Dynamic Competitive Equilibria in Electricity Markets
We are moving towards a radical transformation of our energy systems. The success of the new paradigm created by the Smart Grid vision will require not only the creation and integration of new technologies into the grid, but also the redesign of the market structures coupled with it. In order to design the market structures for the grid of the future, economic models able to capture the new physical reality are the first requirement. In this paper, we present a general economic equilibrium model. The model is constructed using well-known control theory techniques, allowing a natural inclusion of dynamics, uncertainty in supply and demand, and other elements usually not considered in standard economic models.
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