C. Alasseur (EDF) & H. Farhat (Ecole Polytechnique) - A Principal-Agent Approach toCapacity Remuneration Mechanisms
We propose to study electricity capacity remuneration mechanism design through a principal–agent approach. The principal represents the aggregation of electricity consumers (or a representative entity), subject to the physical risk of shortage, and the agent represents the electricity capacity owners, who invest in capacity and produce electricity to satisfy the demand of consumers, and are subject to financial risks. Following the methodology of Cvitanic & al (2018), we propose an optimal Read more [...]
