Strategic Analysis of Electricity Markets Under Uncertainty: A Conjectured-Price-Response Approach

This paper presents a model to address generation companies' medium-term strategic analysis (including yearly forecast and decision-making processes) based on a conjectured- price-response market equilibrium representation that assumes a single node system. This equilibrium is formulated by simultaneous consideration that any of the variables that affect price formation—such as hydro inflows, demand, or fuel prices—are stochastic, by representing them through a scenario tree.