A Short-Term Dynamic Electricity Market Model with Memory Effect

This paper presents a short-term dynamic electricity market model with “memory effect.” The model takes into account how the memory of market participants, in this work the memory of suppliers, impacts on their behavior, i.e., on their bids. The memory effect is represented by employing proper mathematical tools from the theory of fractional calculus. The impact of the proposed fractional-order model on system dynamics and, in particular, its interaction with a secondary frequency control, are studied by means of the well-known WSCC 9-bus system. The proposed model is also compared with a conventional, integer-order electricity market model. Results indicate that the inclusion of memory leads participants, e.g. suppliers, to adopt a conservative behavior.