Pricing

mechanism for real-time balancing in regional electricity markets Mathijs de Weerdt∗, Wolfgang Ketter†, and John Collins‡ We consider the problem of designing a pricing mechanism for precisely controlling the real-time balance in electricity markets, where retail brokers aggregate the supply and demand of a number of individual customers, and must purchase or sell power at the wholesale level such that the total sup-ply matches total demand. This is typically done for future time periods by buying and selling power, and by setting variable prices for retail customers. In real time, balancing must be done through pur-chase of regulating services, and by remotely con-trolling portions of their retail customer loads and sources. We enumerate the desirable properties of a market-based balancing mechanism, and analyze the applicability of known theory in two scenarios: a baseline scenario in which brokers have no abil-ity to manipulate their customers ’ supply and de-mand, and a single-period scenario with control-lable loads. The latter provides promising results for a scenario that takes interactions among time periods into account.