| Capacity Market Design: Motivation and Challenges in Alberta’s Electricity MarketPeer-Reviewed Publication:
Brown, David. (2018) “Capacity Market Design: Motivation and Challenges in Alberta’s Electricity Market,” University of Calgary School of Public Policy, Briefing Paper Series.
Policy paper discussing Alberta's electricity market transition with a growing penetration of renewable generation in the form of either solar or wind. This paper went through the standard peer-review process.
University of Alberta | Publication | 2018-03-28 | Brown, D. |
| Research Award - Assistant ProfessorsSpring 2019: Received the University of Alberta's 2019 Faculty of Arts Research Award for Assistant Professors University of Alberta | Award | 2019-03-11 | Brown, D. |
| Designing Incentive Regulation in the Electricity SectorWorking paper at the Massachusetts Institute of Technology's (MIT's) Center for Energy and Environmental Policy Research (CEEPR).
The final version of this working paper will appear as a chapter in the forthcoming Handbook on Electricity Regulation, edited by Jean-Michel Glachant (Florence School of Regulation), Paul Joskow (MIT), and Michael Pollitt (University of Cambridge) and published by Edward Elgar. University of Alberta | Publication | 2023-11-01 | "David Sappington", Brown, D. |
| Electricity MarketsThis article is forthcoming as a Book Chapter "The Elgar Encyclopedia on the Economics of Competition, Regulation and Antitrust" edited by Michael Noel. University of Alberta | Publication | 2024-03-06 | Brown, D., Eckert, A. |
| Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?Publication of our paper summary in conference proceedings at the IAEE Montreal Conference in 2019. Paper: "Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?" IAEE Energy Forum, Summer 2019. University of Alberta | Publication | 2019-07-16 | Brown, D., Eckert, A. |
| "Imperfect competition in electricity markets with renewable generation: The role of renewable compensation policiesUniversity of Alberta's Resource Energy and Environmental Sociology Department Seminar.
Presentation: "Imperfect competition in electricity markets with renewable generation: The role of renewable compensation policies"
University of Alberta | Activity | 2018-09-21 | Brown, D., Eckert, A. |
| AESO 2023 Economics Excellence ConferencePresentation "Market Power Mitigation in Alberta's Electricity Market" at the Alberta Electric System Operator's (AESO's) 6th Annual Economics Excellence Conference, Calgary Alberta University of Alberta | Activity | 2023-09-26 | Brown, D. |
| ASSA Annual ConferenceAmerican Economic Association Annual Conference, Transportation and Public Utilities Group. Presentation: "The Value of Electric Reliability: Evidence from Battery Adoption" University of Alberta, University of Calgary | Activity | 2022-01-06 | Brown, D., Muehlenbachs, L. |
| Computational Antitrust AchievementsPanel member for session on Computational Antitrust Achievements at the Computational Antitrust: Applying Antitrust 3.0 Conference, December 12, 2023 University of Alberta | Activity | 2023-12-12 | Eckert, A. |
| DER Integration Panel at the Workshop on the Economics of Electricity Policy and MarketsWestern University Ivey Business School - DER Integration Panel. University of Alberta | Activity | 2021-10-13 | Brown, D. |
| Distributed energy resources, resiliency, and reliability. AESO's 4th Annual Economics Excellence Conference - presentation on distributed energy resources, resiliency, and reliability. University of Alberta | Activity | 2021-09-28 | Brown, D. |
| Does locational marginal pricing impact generation investment location decisions? An analysis of Texas’s wholesale electricity marketInternational Association for Energy Economist - Invited Presentation (Webinar) "Does locational marginal pricing impact generation investment location decisions? An analysis of Texas’s wholesale electricity market" University of Alberta | Activity | 2020-05-14 | Brown, D. |
| Imperfect competition in electricity markets with renewable generation: The role of renewable compensation policiesUniversity of Auckland's Energy Centre - One-day workshop on energy economics and policy issues related to renewable energy.
Presentation: " Imperfect competition in electricity markets with renewable generation: The role of renewable compensation policies" (joint with Andrew Eckert) University of Alberta | Activity | 2018-08-01 | Brown, D., Eckert, A. |
| Information and Transparency in Wholesale Electricity Markets: Evidence from AlbertaIn this paper, we examine the role of information transparency in Alberta's wholesale electricity market. Using data on firms' bidding behavior, we analyze whether firms utilize information revealed in near real-time through the Historical Trading Report (HTR), which is released 10 minutes after each hour and contains a complete (de-identified) list of every firms' bids into the wholesale market from the previous hour. We demonstrate that firms are often able to identify the offers of specific rivals by offer patterns adopted by those firms. For one of these firms, these patterns are associated with higher offer prices. This is consistent with suggestions by Alberta's Market Surveillance Administrator that firms may be utilizing unique bidding patterns to reveal their identities to their rivals. We show that certain firms appear to respond to rival offer changes with a lag consistent with responding to information revealed through the HTR, and that they respond differently to different firms, suggesting that they are able to infer identification. However, we find limited evidence that firms respond differently to information disclosed in the HTR when one of the large firms in our sample utilizes its unique bidding pattern University of Alberta | Activity | 2018-06-02 | Brown, D., "James Lin", Eckert, A. |
| Information and Transparency in Wholesale Electricity Markets: Evidence from AlbertaInformation and Transparency in Wholesale Electricity Markets:
Evidence from Alberta
In this article, we investigate the potential impacts of providing too much information to strategic firms in restructured electricity markets using recent evidence from Alberta. This has important implications as regulators are aiming to increase information transparency as we transition to electricity markets with a higher penetration of renewable resources. We demonstrate that firms can potentially utilize this increased information transparency to elevate market prices.
University of Alberta | Activity | 2018-08-01 | Eckert, A., Brown, D., "James Lin" |
| INFORMS Conference - Load-Following Forward ContractsINFORMS Conference presentation - "Load-Following Forward Contracts". University of Alberta | Activity | 2021-10-24 | Brown, D., "David Sappington" |
| Keynote Speaker - TAMIU ConferenceKeynote Speaker: "Electricity Market Design with a High level of Renewable Generation".
Conference: Texas A&M International University’s A. R. Sanchez, Jr. School of Business, 25th Annual Western Hemispheric Trade Conference. University of Alberta | Activity | 2021-04-16 | Brown, D. |
| Market Power and Alberta's Electricity Market RegulationsI gave a talk at the AESO's Economics Excellence Conference related to my work "Evaluating the Impact of Divestitures on Competition: Evidence from Alberta's Wholesale Electricity Market." University of Alberta | Activity | 2022-09-27 | Brown, D. |
| New Frontiers in Electricity Market RegulationAustralian Competition and Consumer Commission and Australian Energy Regulator Annual Regulatory Conference (2018).
Presentation in front of 400 - 600 regulatory economist, government officials, and lawyers in Australia's energy and regulatory industry. I gave three talks on issues ranging from electricity market regulation of distributed energy resources, provider of last resort, and approaches to better integrate renewable resources. University of Alberta | Activity | 2018-07-26 | Brown, D. |
| Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?Presented our paper "Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?". University of Alberta | Activity | 2019-05-29 | Brown, D., Eckert, A. |
| Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?Presentation at the 53rd annual meeting of the Canadian Economics Association, Banff, AB, May 31, 2019 University of Alberta | Activity | 2019-05-31 | Brown, D., Eckert, A. |
| Retail Rate Design in the Face of Growing Distributed Energy ResourcesPresentation: "Retail Rate Design in the Face of Growing Distributed Energy Resources"
90-minute presentation given to the Australian Competition and Consumer Commission in Melbourne Australia. The presentation was a discussion of international approaches being employed to better integrated distributed energy resources such as rooftop solar panels and electric vehicles. Presentation broadcasted across Australia to all of the ACCC offices. University of Alberta | Activity | 2018-07-24 | Brown, D. |
| Sloan Foundation, DER IntegrationModerator for a Panel on Distributed Energy Resource compensation policies - Sloan Foundation. University of Alberta | Activity | 2022-05-31 | Brown, D. |
| The Value of Electricity Reliability: Evidence from Battery AdoptionDepartment Seminar: University of Florida: "The Value of Electricity Reliability: Evidence from Battery Adoption". January 14th 2022. University of Alberta | Activity | 2022-01-14 | Brown, D. |
| The Value of Electricity Reliability: Evidence from Battery AdoptionIAEE Webinar - May 16th. Presentation: "The Value of Electricity Reliability: Evidence from Battery Adoption" University of Alberta, University of Calgary | Activity | 2022-05-16 | Brown, D., Muehlenbachs, L. |
| The Value of Electricity Reliability: Evidence from Battery AdoptionUniversity of Calgary - Electricity Workshop. June 2022. Presentation: "The Value of Electricity Reliability: Evidence from Battery Adoption" University of Alberta, University of Calgary | Activity | 2022-06-17 | Brown, D., Muehlenbachs, L. |
| The Value of Electricity Reliability: Evidence from Battery AdoptionCenter For Regulation and Regulated Industries (CRRI), Rutgers University, Western Conference. Presentation: "The Value of Electricity Reliability: Evidence from Battery Adoption" University of Alberta, University of Calgary | Activity | 2022-06-22 | Brown, D., Muehlenbachs, L. |
| University of Alberta’s Business School Energy and the Environment ConferenceBrown, David. University of Alberta’s Business School Energy and the Environment Conference, Edmonton, Alberta, September 21, 2017
Conference presentation on the future of Alberta's electricity market, renewable penetration, and carbon pricing policies. University of Alberta | Activity | 2017-09-21 | Brown, D. |
| Essays on Renewable Energy, Electricity Markets and Local Communities | Publication | 2024-04-16 | Boris Edgardo Ortega Moreno |
| Three Essays in Energy EconomicsPhD Thesis | Publication | 2024-04-30 | Yiang Guo |
| Lessons from Texas' Electricity OutagesPublic Talk: Economic Society of Northern Alberta - "Lessons from Texas' Electricity Outages University of Alberta | Activity | 2021-04-05 | Brown, D. |
| Analyzing firm behavior in restructured electricity markets: Empirical challenges with a residual demand analysisJournal Article: "Analyzing firm behavior in restructured electricity markets: Empirical challenges with a residual demand analysis," International Journal of Industrial Organization.
Using data from Alberta’s wholesale electricity market, we demonstrate the challenges that can arise when characterizing a firm’s unilateral expected profit-maximizing offer curve. We illustrate that the residual demand curves faced by firms can be highly non-linear, resulting in non-monotonic, downward sloping, optimal best-response offer curves violating common restrictions imposed on bidding behavior. This can have important implications on the conclusions drawn from such empirical analyses. We identify features of residual demand curves that can lead to these problems, providing guidance to researchers utilizing these methods. We find that a simplified monotonic smoothing of the unconstrained ex-post optimal offer curve can achieve the majority of the expected profits, offering an alternative to calculating the ex-ante expected profit-maximizing offer curve that can be computationally burdensome. University of Alberta | Publication | 2021-01-06 | Brown, D., Eckert, A. |
| Capacity Payment Mechanisms and Investment Incentives in Restructured Electricity MarketsBrown, David. (2018). “Capacity Payment Mechanisms and Investment Incentives in Restructured Electricity Markets,” Energy Economics, 74: 131 - 142.
In this article, I investigate the impact of renewable penetration on the future of Capacity Payment Mechanisms, a common market design in restructured electricity markets.
Energy Economics is a top field journal in Energy Economics and Policy University of Alberta | Publication | 2018-08-30 | Brown, D. |
| Do Gentailers Charge Higher Residential Electricity Prices in the Texas Retail Electricity Market?Scholarly Publication: "Do Gentailers Charge Higher Residential Electricity Prices in the Texas Retail Electricity Market?"
Published: The Electricity Journal University of Alberta | Publication | 2022-05-01 | Brown, D., "Jay Zarnikau", "Chen-Hao Tsai" |
| Does Locational Marginal Pricing Impact Generation Capacity Investment Location Decisions? An Analysis of Texas’s Electricity MarketBrown, D., Zarnikau, J., and C.K. Woo (2020). "Does Locational Marginal Pricing Impact Generation Capacity Investment Location Decisions? An Analysis of Texas’s Electricity Market." Journal of Regulatory Economics. University of Alberta | Publication | 2020-08-26 | Brown, D., "Jay Zarnikau", "Chi-Keung Woo" |
| Evaluating the Impact of Divestitures on Competition: Evidence from Alberta's Wholesale Electricity MarketThis article has published in the International Journal of Industrial Organization. University of Alberta, University of Calgary | Publication | 2023-07-05 | Brown, D., Eckert, A., Shaffer, B. |
| Information and Transparency in Wholesale Electricity MarketsBrown, David and Andrew Eckert (2018) "Information and Transparency in Wholesale Electricity Markets", Journal of Regulatory Economics, 54(3), 292 - 330.
In this article, we investigate the potential impacts of providing too much information to strategic firms in restructured electricity markets using recent evidence from Alberta. This has important implications as regulators are aiming to increase information transparency as we transition to electricity markets with a higher penetration of renewable resources. We demonstrate that firms can potentially utilize this increased information transparency to elevate market prices.
University of Alberta | Publication | 2018-11-01 | Brown, D., Eckert, A., "James Lin" |
| Information and Transparency: Using Machine Learning to Detect Communication Between FirmsThis article has been published in the journal "Stanford Computational Antitrust". University of Alberta | Publication | 2023-10-18 | Brown, D., Douglas Silveira, Eckert, A., "Daniel Cajueiro" |
| Load-Following Forward ContractsThis article has been published at The Energy Journal in the Summer of 2022. University of Alberta | Publication | 2022-07-04 | Brown, D., "David Sappington" |
| Motivating Efficient Market Participation of Energy Storage AssetsBrown, D. and D. Sappington (2020). "Motivating Efficient Market Participation of Energy Storage Assets," Energy Policy, Forthcoming.
In this paper, we analyze regulatory policies designed to better integrate utility-scale battery storage (and solar PV) into restructured electricity markets. This allows utilities to unlock multiple value streams for these assets.
University of Alberta | Publication | 2019-10-01 | Brown, D., "David Sappington" |
| Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?"Pricing Patterns in Wholesale Electricity Markets: Unilateral Market Power or Coordinated Behavior?" University of Alberta Working Paper.
Abstract:
Suspicions of coordinated behaviour may arise when firms are observed behaving in conspicuous ways that could be designed to communicate with rivals. .Unfortunately, the observation of anomalous behaviour not observed among firms not believed to be colluding is insufficient to conclude that coordination to increase profits above non-cooperative levels is taking place. A recent example highlighting these concerns involves the wholesale electricity market in Alberta, in which certain firms have been observed to use patterns in their bids into the market that could reveal their identities and convey information. In this paper, we develop an empirical methodology to examine whether observed offer behaviour by certain firms in Alberta's wholesale electricity market was consistent with firms unilaterally maximizing expected wholesale (spot) market profits, given the bidding behaviour of rival firms. We apply this methodology to hourly offer price and quantity data for the year 2013. Our results suggest that firms could have increased profits through unilateral deviations from their observed offers. For one of the firms, the potential to increase profits through unilateral deviations is greater on days in which certain offer patterns are observed, providing some support for the claim that such patterns may have played a role in coordinating on outcomes that are more profitable than noncooperative equililbria. These results suggest that regulators should exercise caution when undertaking policies that increase information disclosure in concentrated electricity markets where firms interact repeatedly.
Accepted at the Journal of Industrial Economics. A top journal in Industrial Organization. University of Alberta | Publication | 2022-03-26 | Brown, D., Eckert, A. |
| Procurement auctions for regulated retail service contracts in restructured electricity marketsThis article was published in Energy Economics in December 2022. University of Alberta | Publication | 2022-12-01 | Brown, D., Eckert, A., "Derek Olmstead" |
| Residential Electricity Pricing in Texas's Competitive Retail Market"Residential Electricity Pricing in Texas's Competitive Retail Market, under review at Energy Economics.
Using a large sample of residential retail electricity plans advertised on the Public Utility
Commission of Texas’s Power-to-Choose website from January 2014 to December
2018, our panel regression analysis finds changes in the projected wholesale price of
electricity not fully reflected as changes in these plans’ price quotes. The estimated rates of
wholesale price pass-through rates range from 43% to 45%. Retailers tend to charge risk
premia that increase with wholesale price volatility. Prepayment and time-of-use plans likely
contain price premia. The price premia associated with higher-than-average renewable energy
contents in the early years of our sample have largely vanished by 2018. Longer contract
terms come at a higher price. Finally, increased customer switching tends to reduce retail
price quotes, implying that Texas’s residential retail market can be made more price
competitive through consumer education on plan choices and dissemination of credible price
information. University of Alberta | Publication | 2020-10-01 | Brown, D., "Chen-Hao Tsai", "Jay Zarnikau", "Chi-Keung Woo", "Lucy Zhu" |
| Screening for collusion in wholesale electricity markets: A literature reviewThis article has been published in Utilities Policy in 2023. University of Alberta | Publication | 2023-12-13 | Brown, D., Eckert, A., "Dogulas Silveira" |
| Socioeconomic and Demographic Disparities in Residential Battery Storage AdoptionArticle Published in Energy Policy University of Alberta | Publication | 2022-05-01 | Brown, D. |
| Strategic interaction between wholesale and ancillary service marketsThis article has been published at the Competition and Regulation in Network Industries. University of Alberta | Publication | 2023-11-22 | Brown, D., Eckert, A., Douglas Silveira |
| Strategic Interaction of Wholesale Market Power and Ancillary Service MarketsWorking Paper "Strategic Interaction of Wholesale Market Power and Ancillary Service Markets". In preparation to submit to a peer-reviewed journal. University of Alberta | Publication | 2022-04-09 | Brown, D., Eckert, A., Douglas Silveira |
| The Impact of Load-Following Forward ContractsAcademic Article: "The Impact of Load-Following Forward Contracts".
Revise and Resubmit at The Energy Journal. University of Alberta | Publication | 2022-04-09 | Brown, D., "David Sappington" |
| The Value of Electricity Reliability: Evidence from Battery AdoptionWorking Paper: "The Value of Electricity Reliability: Evidence from Battery Adoption". This article has been published as a Working Paper with Resources for the Future. We currently have a revise and resubmit at the Journal of Public Economics. University of Alberta, University of Calgary | Publication | 2023-04-18 | Brown, D., Muehlenbachs, L. |
| Vertical Integration and Capacity Investment in the Electricity Sector"Vertical Integration and Capacity Investment in the Electricity Sector" joint with David Sappington.
Accepted Journal of Economics and Management Strategy. University of Alberta | Publication | 2021-09-01 | Brown, D., "David Sappington" |
| Episode 21: Using Machine Learning to Detect Tacit CollusionPodcast hosted by Stanford University Codex Center, Computational Antitrust project. University of Alberta | Publication | 2023-11-04 | Daniel O Cajueiro, Eckert, A., Brown, D., Douglas Silveira |
| Ergs and Equilibrium - the Value of Electricity Reliability: Evidence from Battery AdoptionWestern University - Podcast "Ergs and Equilibrium". Discussing paper: "The Value of Electricity Reliability: Evidence from Battery Adoption". University of Alberta, University of Calgary | Publication | 2022-05-12 | Brown, D., Muehlenbachs, L. |
| Why are Power Prices so Darn High?University of Calgary School of Public Policy Energy and Environmental Policy Trends University of Calgary, University of Alberta | Publication | 2022-04-20 | Shaffer, B., Brown, D., Eckert, A. |
