Spot market design and its influence to the entire electricity market and market regulation

This paper presents a framework for policy makers in China that identifies the relevant design variables and market objectives that play a role in the design and analysis of spot market. We outline the full extent of the design challenge through a discussion of interactions between design variables and how they act to market objectives, and the inter-linkages between the spot market design of energy and other products, the inter-linkages with market regulation at large. In fact, the energy market design has a trend of convergence. Policy makers can address the spot market design challenge by adopting a structured approach in which market objectives, design space variables, linkage between markets products and market regulation are explicitly considered.