Modelling negative prices in AMIRIS

AMIRIS price duration curves showed negative prices. How are those achieved? Which agents submitted negative bids?

Negative prices can occur in AMIRIS as a result of the market clearing process. Traders may submit negative bids for multiple reasons, e.g.,

  • traders of conventional power plants: these aim to avoid becoming extra-marginal (dropping out of the merit order), e.g., to avoid ramping costs or to reflect must-run conditions. In AMIRIS, this is modelled via mark-downs.
  • traders for renewable power plants: such plants may still make a profit at negative prices due to expected payments in a premium scheme.
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