Annals of Operations Research

, Volume 158, Issue 1, pp 229–241 | Cite as

Strategic bidding in continuous electricity auctions: an application to the Spanish electricity market

  • Juan Aparicio
  • Juan Carlos Ferrando
  • Ana Meca
  • Julia Sancho


In this paper we introduce an asymmetric model of continuous electricity auctions with limited production capacity and bounded supply functions. The strategic bidding is studied with this model by means of an electricity market game. We prove that for every electricity market game with continuous cost functions a mixed-strategy Nash equilibrium always exists. In particular, we focus on the behavior of producers in the Spanish electricity market. We consider a very simple form for the Spanish electricity market: an oligopoly consisting just of independent hydro-electric power production units in a single wet period. We show that a pure-strategy Nash equilibrium for the Spanish electricity market game always exists.


Continuous electricity auctions Spanish electricity market Electricity market game Nash equilibrium 


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Copyright information

© Springer Science+Business Media, LLC 2007

Authors and Affiliations

  • Juan Aparicio
    • 1
  • Juan Carlos Ferrando
    • 1
  • Ana Meca
    • 1
  • Julia Sancho
    • 1
  1. 1.Centro de Investigación OperativaUniversidad Miguel HernándezElche (Alicante)Spain

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