Reliability & Markets
CERTS' objective in the area of Reliability and Markets is to conduct science-based research to understand how to design (as well as test and monitor) fair and transparent markets that will efficiently provide reliable electricity to consumers. As an impartial third party, CERTS can make technically sound investigations based on consistent economic principles, including investigations of market operations to understand current market events (e.g., price spikes) and analysis of the likely effects of proposed market design changes. Deepening the understanding of market operations will both decrease the need to interfere with the market (e.g., through price caps) and provide guidance to support operating decisions that improve reliability and market performance.
CERTS is developing a comprehensive set of integrated market/engineering design principles and tools for a restructured electricity industry. Development of these principles and tools relies on:
- Theoretical analysis, focusing on modeling and employing techniques of operations research, systems analysis, microeconomics, stochastic modeling, game theory, and auction theory.
- Empirical analysis, focusing on gathering and interpreting empirical data and on estimating and validating theoretical models, using econometric methods, financial engineering approaches, statistical analysis, and data mining.
- Computational methods, employing numerical approaches and agent-based models to simulate and forecast market outcomes and using realistic modeling of the electric power system in conjunction with behavioral models of economic agents that control various aspects of the system and interact in the marketplace.
- Experimental economics approaches, employing controlled laboratory experiments with live and artificial agents to explore decision patterns under alternative rules and system conditions and to test behavioral assumptions on which such rules are based.
|Developed PowerWeb Experimental Economics Platform.||More information|
Robert J. Thomas