This question is based on a two node network. The generator…

This question is based on a two node network. The generator at Node 1 has a marginal cost of $15/MWh and submits a competitive offer to the electricity market. The generator at Node 2 has a marginal cost of $40/MWh. The demand curve is given by P = 160 – (G1+G2), and all demand is located at Node 2. The transmission line connecting Nodes 1 and 2 has a capacity of 40 MW. Both generators have a capacity of 200 MW. 1) Calculate the residual demand at Node 2 2) Calculate the LMP at Node 2. Note: Please write your answers in integers, for example, 2, -3, etc. Write only numbers, and do not write unit in your answer.

Calculate the HHI for an electricity market where the capaci…

Calculate the HHI for an electricity market where the capacity ownership is listed below. Note that the total size of the market is 100 MW and the numbers listed for each firm are capacity holdings (also in MW). Firm A: 68 MW Firm B: 6 MW Firm C: 5 MW Firm D: 12 MW Firm E: 9 MW

Suppose that Firm A is located at Node A, and buys 25 MW of…

Suppose that Firm A is located at Node A, and buys 25 MW of power from Firm B, who is located at Node B. The contract is bilateral, but all the physical energy is bid into the PJM energy market; thus Firm A winds up paying the Node A LMP for the 25 MW consumed and Firm B receives the Node B LMP for the 25 MW produced. Suppose that Firms A and B sign a two-way CFD at a strike price of $10/MWh. Suppose also that Firm B has a 25 MW Financial Transmission Right from Node B to Node A. What are the total revenues for Firm B?