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Article dans une revue

The impact of a virtual power plant on the day-ahead market in France

Abstract : This paper studies the impact of virtual power plant (VPP) contracts on the French day-ahead market. Holders of VPPs have the right to access electric power at a predetermined strike price per MWh in 30-minute slices 24 hours per day, 7 days a week during the delivery period, after paying an upfront premium, which is fixed at the auction. So VPPs are call options. Recent work on market power in Nordic countries suggests that subtle mechanisms such as transfers from one time period to another may be involved, rather than short-run manipulations. To assess the effect VPPs have on market power we need to understand precisely how they function. In this paper we show that the structure of the market allows holders of VPPs to sell power on the exchange when the day-ahead price is above the VPP strike (if they do not need the power) and conversely to buy power when the price is below the strike. By documenting the strike prices of VPPs that were active at different times and by carefully examining the structure of day-ahead prices we demonstrate that they are doing this.
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Contributeur : Yann Ménière <>
Soumis le : vendredi 21 décembre 2012 - 18:16:03
Dernière modification le : jeudi 24 septembre 2020 - 16:58:02


  • HAL Id : hal-00768534, version 1


Margaret Armstrong, Alain Galli. The impact of a virtual power plant on the day-ahead market in France. Journal of Energy Markets, 2010, 3 (1), pp.53-71. ⟨hal-00768534⟩



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