Forecasting Electricity Prices in Deregulated Wholesale Spot Electricity Market - A Review

Authors

  • Girish Godekere Panchakshara Murthy Department of Finance, IBS Hyderabad, IFHE University (a Deemed to-be-University under Section 3 of UGC Act 1956)
  • Vijayalakshmi Sedidi Department of Finance, IBS Hyderabad, IFHE University (a Deemed to-be-University under Section 3 of UGC Act 1956)
  • Ajaya Kumar Panda Department of Humanities and Social Sciences National Institute of Technology (NIT) Goa
  • Badri Narayan Rath Department of Liberal Arts Indian Institute of Technology (IIT) Hyderabad

Abstract

In the new framework of competitive electricity markets, all power market participants need accurate price forecasting tools. Electricity price forecasts characterize significant information that can help captive power producer, independent power producer, power generation companies, power distribution companies or open access consumers in careful planning of their bidding strategies for maximizing their profits, benefits and utilities from long term, medium term and short term perspective. Short term spot electricity price forecasting techniques are either inspired from electrical engineering literature (i.e. load forecasting) or from economics literature (i.e. game theory models and the time-series econometric models). In this study we investigate the emergence of spot electricity markets with particular emphasis on Indian electricity market which has never been done before and review selected finance and econometrics inspired literature and models for forecasting electricity spot prices in deregulated wholesale spot electricity markets.

Keywords: spot price; electricity; forecasting; power market

JEL Classifications: C01; C22; C53

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Author Biographies

Girish Godekere Panchakshara Murthy, Department of Finance, IBS Hyderabad, IFHE University (a Deemed to-be-University under Section 3 of UGC Act 1956)

Mr. Girish G P is a Teaching Faculty and Doctoral Research Scholar at IBS Hyderabad, IFHE University (a deemed-to-be-University under Sec 3 of UGC Act 1956). He teaches Financial Management courses at Undergraduate and Post Graduate level (i.e. for MBA and BBA). He has obtained his bachelors in Electrical and Electronics Engineering from University Visveswaraya College of Engineering (UVCE), Bangalore University and his Masters in Business Administration (Finance) from IBS Hyderabad, IFHE University. He is a recipient of Complete Scholarship for his MBA and PhD education from IBS Hyderabad. He was a Visiting Research Scholar at the Center for Financial Risk, Department of Applied Finance and Actuarial Studies, Macquarie University, Sydney, Australia and also pursued a semester of his MBA in Adelaide, Australia under complete Scholarship (Study Abroad Program-IBS Adelaide-University of South Australia (UniSA)). He is presently a Reviewer (Ad-hoc) for Journal of Business and Economic Management, Academia Publishing, USA. His areas of interest are Financial Risk Management, Energy Risk Management and Power Markets.

Vijayalakshmi Sedidi, Department of Finance, IBS Hyderabad, IFHE University (a Deemed to-be-University under Section 3 of UGC Act 1956)

Associate Professor and Area Coordinator (Finance),IBS Hyderabad, IFHE University, India

Ajaya Kumar Panda, Department of Humanities and Social Sciences National Institute of Technology (NIT) Goa

Assistant Professor (Economics),NIT Goa,India

Badri Narayan Rath, Department of Liberal Arts Indian Institute of Technology (IIT) Hyderabad

Head of the Department (Liberal Arts),Indian Institute of Technology (IIT) HyderabadIndia

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Published

2013-11-16

How to Cite

Murthy, G. G. P., Sedidi, V., Panda, A. K., & Rath, B. N. (2013). Forecasting Electricity Prices in Deregulated Wholesale Spot Electricity Market - A Review. International Journal of Energy Economics and Policy, 4(1), 32–42. Retrieved from https://www.econjournals.com/index.php/ijeep/article/view/621

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