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Electricity Market Modeling

The Brattle Group offers an unparalleled combination of electricity market modeling capabilities, a rich understanding of the interrelationships among market factors, and practical and thoughtful application of models to address our clients’ critical questions and challenges.

We have been engaged in a large number of electricity market modeling assignments across every wholesale market in North America and Europe. We have worked with market participants, regulators, and system operators, often in the context of regulatory proceedings, policy analysis, and stakeholder engagements. We pride ourselves on communicating our insights so they are intuitive, useful, and credible to target audiences.

We provide specialized market simulation tools to address the wide range of wholesale electricity market matters and challenges faced by our clients.

We bring to our engagements several types of modeling tools that can be customized to meet our clients’ specific needs.  In applying these tools we consistently demonstrate our ability to analyze the details that matter, model them accurately, and clearly communicate insights into markets, values, and risks.

Areas of Expertise


Below is a list of representative engagements for our Electricity Market Modeling practice. For additional examples of our client engagements, please select any one of the areas of expertise listed here.

Evaluation of "Wind Catcher" Energy Connection line to integrate the largest wind project in the U.S.

For American Electric Power (AEP), we developed a market simulation and benefit-cost framework to quantify the benefits of integrating the proposed 2,000 MW Wind Catcher generating plant through a 765 kV generation tie line from the wind-rich Oklahoma Panhandle region to the Tulsa load center. We quantified congestion and marginal loss benefits, impact on AEP load and generation prices, and costs compared to acquiring a similar amount of wind generation through traditional procurement options.  We also assisted AEP in integrating these analyses into its company-specific resource planning framework for presentation to state regulatory commissions.

Benefit-cost analysis of ERCOT's proposed Future Ancillary Services design

For the Electric Reliability Council of Texas (ERCOT), we evaluated the benefits of its proposal to unbundle ancillary services, enable broader participation by load resources and new technologies, and tune its procurement amounts to system conditions. We worked with ERCOT staff to assess each ancillary service and how generation, load resources, and new technologies could participate. We also directed their simulation of the market using PLEXOS, and evaluated other benefits outside of the model.

Simulation of marginal losses implementation in ERCOT

For a group of market participants in Texas, we estimated the impacts of implementing marginal losses in the ERCOT market on system production costs, transmission losses, LMPs, load payments, and generator revenues. We simulated the ERCOT power system using PSO and calibrated the model status quo model to recent generation and load patterns. The study results were made public in a proceeding before the Texas Public Utility Commission.

Review and simulation analysis of PJM's capacity demand curve

For PJM, we conducted all four official reviews of its Reliability Pricing Model (2008, 2011, 2014, and 2018). We evaluated the demand curve shape, the CONE parameter, and the methodology for estimating net energy and ancillary services revenues. We recommended improvements to support participation and competition, avoid excessive price volatility, and safeguard future reliability performance. We submitted testimony before the FERC and participated in settlement discussions.

Renewable integration for Aruba and other island systems

Island power planning faces distinct problems not observed in larger markets. Brattle experts prepared a study for W.E.B. Aruba, the power generation and water provider on the island, on integrating 30 percent of wind energy and 10 percent of other renewables, including solar and biogas. The study included development of different ancillary service requirements, detailed operational simulations accounting for renewables and load forecast uncertainty and variability, generator maintenance and forced outages, economic cost, and benefit evaluations of renewables integration. Several technologies were analyzed to improve wind integration, including different types of storage and demand management solutions. Including the approved second wind plant, several solar plants, and other innovative technology options, Aruba is expected to attain nearly 50 percent energy from renewable resources by 2018. Brattle experts are now being asked to help prepare a roadmap for Aruba to achieve the ultimate goal of becoming 100 percent oil-fuel free (for energy and water production). Similar analyses have been prepared for several other islands.

Optimization of existing hydro storage facilities' market participation

For a large generation and transmission utility operating in an RTO market, Brattle evaluated the historical energy and ancillary services market performance of a large multi-unit hydro-storage power plant. Using detailed simulations of regional market participation and statistical analysis of historical resource bids in these markets, we developed more optimal bidding strategies for the power plant. The improved bidding strategies cover energy and ancillary services in the day-ahead and real-time markets considering forecasting uncertainties. The selected strategy is forecasted to increase net plant revenues by 200 to 300% compared to historical revenue realizations.

Benefits and cost analysis of implementing a Western U.S.-wide energy market

In 2016, Brattle experts led a team of multiple consulting companies to help California ISO evaluate ISO regionalization and transitioning the Western Interconnection into a locational marginal cost-based full “Day-2” energy market with centralized optimized day-ahead unit commitment and real-time dispatch. Our role included using PSO to develop West-wide nodal production cost simulations for 2020 through 2030 to assess impacts on ratepayers, emissions, grid operations, and the ability to integrate large amounts of variable renewable generation across the region. We also analyzed the findings of other regional markets that have gone through similar transitions, reviewing two dozen ex-post and ex-ante studies of the costs and benefits of regionalization, transitioning from zonal to nodal market design, and migrating from a real-time imbalance market to a full day-ahead market with optimized unit commitments and ancillary services markets. Our work culminated in a public report and several presentations to stakeholder groups across the West and in California. It provided the analytical foundation for active ongoing multi-state discussions about ISO regionalization.

New York's Evolution to a Zero Emission Power System: Modeling Operations and Investment Through 2040 Including Alternative Scenarios
June 22, 2020
Prepared for NYISO Stakeholders
New York's Evolution to a Zero Emission Power System: Modeling Operations and Investment Through 2040
May 18, 2020
Prepared for NYISO Stakeholders
Joint Dispatch Agreement Energy Imbalance Market Participation Benefits Study
January 14, 2020
Judy Chang, Johannes P. Pfeifenberger, John Tsoukalis, Sophie Leamon, and Carson Peacock
Prepared for Black Hills Corporation, Colorado Spring Utilities, Platte River Power Authority, and Public Service Company of Colorado
Load Serving Entities: What Could Transition Toward a Load Serving Entity Model Mean for Ontario?
June 2019
Presented at Electricity Marketplace of the Future IESO Stakeholder Summit
International Review of Demand Response Mechanisms in Wholesale Markets
June 2019
Prepared for the Australian Energy Market Commission
Capacity Markets and Wholesale Market Outcomes
May 28, 2019
Presented at NBER Economics of Electricity Markets and Regulation Workshop
How States, Cities, and Customers Can Harness Competitive Markets to Meet Ambitious Carbon Goals: Through a Forward Market for Clean Energy Attributes
April 2019
Prepared for NRG
Transmission Topology Optimization: Application in Operations, Markets, and Planning Decision Making
May 2019
Demand Curve and Energy and Ancillary Services Offset
April 11, 2019
Kathleen Spees, Michael Hagerty, Cathy Wang, and Matthew Witkin
Prepared for Alberta Electric System Operator
The Future of Ontario's Electricity Markets: Updated Study Results
December 2018 (Revised February 2019)
David Luke Oates, Judy Chang, Kathleen Spees, John Imon Pedtke, and Jill Moraski
Presented to Non-Emitting Resources Subcommittee
High-Impact, Low-Probability Events and the Framework for Reliability in the National Electricity Market
February 2019
Toby Brown, Neil Lessem, Roger Lueken, Kathleen Spees, and Cathy Wang
Prepared for The Australian Energy Market Commission
Alberta's Capacity Market Demand Curve: Analysis of a Demand Curve Based on Marginal Reliability Impact
January 2019
Kathleen Spees, David Luke Oates, Cathy Wang, and Matthew Witkin
Prepared for Alberta Electricity System Operator
Alberta's Capacity Market Demand Curve
January 2019
Kathleen Spees, David Luke Oates, Cathy Wang, John Imon Pedtke, and Matthew Witkin
Prepared for Alberta Electricity System Operator
Estimation of the Market Equilibrium and Economically Optimal Reserve Margins for the ERCOT Region
December 20, 2018
Samuel A. Newell, Ariel Kaluzhny, Kathleen Spees, Kevin Carden, Nick Wintermantel, Alex Krasny, and Rebecca Carroll
Prepared for the Electric Reliability Council of Texas, Inc.
Negative Pricing in Wholesale Energy Markets
November 30, 2018
Kathleen Spees, Nicole Irwin, Judy Chang, John Imon Pedtke, Emily Shorin, Maria Castaner, and Matthew Witkin
Prepared for Independent Electricity System Operator of Ontario; Presented to Non-Emitting Resources Subcommittee
Clean Energy Markets: The "Missing Link" to Market Design 3.0
October 4, 2018
Presented to the Harvard Electricity Policy Group
Maximizing the Market Value of Flexible Hydro Generation
March 29, 2018
Published by The Brattle Group, Inc.

The study examines flexible hydro resources in wholesale power markets and finds that improving operational practices and market rules may be able to enhance the value of these resources by 200% to 500%.

Market Design for a Clean Grid: Unlocking the Potential of Non-Emitting and Emerging Technologies
January 22, 2018
Kathleen Spees and Matthew Witkin
Presented to the Non-Emitting Resource Subcommittee
The Future of Cap-and-Trade Program in California: Will Low GHG Prices Last Forever?
December 05, 2017
Yingxia Yang, Michael Hagerty, Ashley Palmarozzo, Hannah Sheffield, Metin Celebi, Frank C. Graves, and Marc Chupka
Published by The Brattle Group, Inc.

A discussion paper examining the trends of the California greenhouse gas (GHG) market and analyzes the underlying future drivers that will affect California GHG prices to achieve the state’s ambitious goal of 80% decarbonization by 2050.

Modeling the 1-Step and 2-Step Dispatch Approaches to Account for GHG Emissions from EIM Transfers to Serve CAISO Load
November 17, 2017
Judy Chang, Johannes P. Pfeifenberger, Kai Van Horn, Mariko Geronimo Aydin, and Onur Aydin
Prepared for the California ISO
Impacts of Marginal Loss Implementation in ERCOT
October 11, 2017
Metin Celebi, Toshiki Bruce Tsuchida, Colin McIntyre, Ariel Kaluzhny, and Rebecca Carroll
Prepared for Ad Hoc Group, including Vistra Energy, The Wind Coalition, and First Solar
Advancing Past "Baseload" to a Flexible Grid: How Grid Planners and Power Markets Are Better Defining System Needs to Achieve a Cost-Effective and Reliable Supply Mix
June 26, 2017
Judy Chang, Mariko Geronimo Aydin, Johannes P. Pfeifenberger, Kathleen Spees, and John Imon Pedtke
Prepared for the Natural Resources Defense Council (NRDC)

The report examines why traditional “baseload” power plants, such as coal and nuclear, are becoming less economical, why their ability to produce power continuously is less essential in today’s supply mix, and why operational flexibility is an increasingly important ingredient for a cost-effective supply of electricity.

Senate Bill 350 Study: The Impacts of a Regional ISO-Operated Power Market on California
July 12, 2016
Judy Chang, Johannes P. Pfeifenberger, Mariko Geronimo Aydin, Onur Aydin, Kai Van Horn, David Luke Oates, Lauren Regan, Peter Cahill, and Colin McIntyre
Prepared for the California Independent System Operator. Co-authored by members of The California Independent System Operator, Energy and Environmental Economics, Inc., Berkeley Economic Advising and Research, LLC, and Aspen Environmental Group.
Cost-Benefit Analysis of ERCOT's Future Ancillary Services (FAS) Proposal
December 21, 2015
Samuel A. Newell, Pablo Ruiz, Will Gorman, and Rebecca Carroll
Prepared for the Electric Reliability Council of Texas (ERCOT)
News & Knowledge
December 02, 2020
Kathleen Spees to Discuss Power System Modeling at EBA Webinar

Brattle Principal Kathleen Spees will join the Environmental Law Institute (ELI) and Energy Bar Association (EBA) webinar “Modeling for Lawyers” on December 2 from 11:30 a.m.–12:30 p.m. (PT) / 2:30–3:30 p.m. (ET).

August 26, 2020
Samuel Newell to Discuss Capacity Markets at Rutgers CRRI Webinar

Brattle Principal Samuel Newell will join a Rutgers Center for Research in Regulated Industries (CRRI) Regulatory Webinar on August 26 from 12:00–1:30 p.m. (PT)/3:00–4:30 p.m. (ET).

July 15, 2020
Samuel Newell to Discuss Capacity Market Alternatives at PMT Webinar

Brattle Principal Samuel Newell will join a Power Markets Today (PMT) webinar to discuss “Capacity Market Alternatives for States” on July 15 at 11:00 a.m. (PT)/2:00 p.m. (ET).

June 18, 2020
Who's Who Legal Recognizes Brattle Economists as Leading Consulting Experts for their Work in Energy

Who’s Who Legal has recognized six Brattle economists as leading economic consulting experts in their WWL Energy 2020 list: Dr. Ahmad Faruqui, Dr. José Antonio García, Dan Harris, Carlos Lapuerta, Dr. Pedro Marín, and Dr. Kathleen Spees.

April 17, 2019
Report Co-Authored by The Brattle Group and Edison Electric Institute Discusses a Modeling Approach for Understanding Changes in the Electric Utility Industry

A new report authored by Brattle Principal Bruce Tsuchida and Lawrence Jones of the Edison Electric Institute (EEI) introduces a modeling approach that can help industry planners understand the feedback and interdependencies caused by the complex changes happening in the electric utility industry, and develop effective strategies against these ongoing changes.

March 29, 2018
Brattle Economists: Some Hydro Plants Substantially Undervalued in Today's Power Markets

Economists at The Brattle Group released a study today that examines flexible hydro resources in wholesale power markets and finds that improving operational practices and market rules may be able to enhance the value of these resources by 200% to 500%.

December 05, 2017
Reaching California's Deep Decarbonization Goals May Require Large Increases in Carbon Prices in the Absence of Further Technological Breakthroughs, According to Brattle Economists

A discussion paper by economists at The Brattle Group examines the trends of the California greenhouse gas (GHG) market and analyzes the underlying future drivers that will affect California GHG prices to achieve the state’s ambitious goal of 80% decarbonization by 2050. 

June 26, 2017
Brattle Economists Recommend Moving beyond "Baseload" Generation for Planning and Operating Today's Electric Grid

Brattle economists have released a report explaining how the use of the term “baseload” generation is no longer useful for the purposes of planning and operating today’s electricity system.

July 12, 2016
Study Co-Authored by Brattle Economists Examines Impacts of a Regional Power Market in the Western U.S. for California ISO

Brattle economists have co-authored a new study that provides a comprehensive examination of the impacts of transforming the California Independent System Operator into a multistate, regional ISO.