Interdependent electricity markets design: Market power and gaming

The present paper scrutinizes the interdependent electricity markets (IEMs) design guide in terms of gaming and evaluating the potential of exercising market power. The new circumstances of gaming and the potential of exercising the market power within IEMs alongside the assessment of financial/physical withholding and transmission congestion have been analysed. Furthermore, the role of asymmetric markets manifested by renewable energy sources (RES) in the issues of gaming and market power by increasing the integration of the markets within IEMs is studied. Additionally, a new model is applied to the coordinator's objective function to manage the network congestion in all markets. The results show the asymmetric RES development policies, initially, reduce the Herfindahl-Hirschman Index (HHI) in the market with more RES development; however, HHI increased by further increasing RES. Also, integration of the markets initially increases the HHI and then by increasing the market integration further, this index declined in all markets.