Dominant electricity firm in Ireland may abuse market power in capacity market.
The article examines how a new electricity market design in Ireland could allow the dominant firm to abuse its market power. By modeling a two-stage game, the researchers found that the dominant firm has significant potential to abuse market power in both the electricity and capacity markets. Factors like the amount of capacity procured, potential entrants, and market competitiveness play a role in determining the likelihood of market power abuse.