A modell of socially optimal hydro reservoir usage - yelding socially optimal outcomes in nordic electricity markets

An extensive electricity transmission network facilitates electricity trading between Finland, Sweden, Norway and Denmark. Currently most of the area's power generation is traded at NordPool, where the trading volumes have steadily increased since the early 1990's, when the exchange was founded. The Nordic electricity is expected to follow the current trend and further integrate with the other European electricity markets. Hydro power is the source for roughly a half of the supply in the Nordic electricity market and most of the hydro is generated in Norway. The dominating role of hydro power distinguishes the Nordic electricity market from most of the other market places. Production of hydro power varies mainly due to hydro reservoirs and demand for electricity. Hydro reservoirs are affected by water inflows that differ each year. The hydro reservoirs explain remarkably the behaviour of the Nordic electricity markets. Therefore among others, Kauppi and Liski (2008) have developed a model that analyzes the behaviour of the markets using hydro reservoirs as explanatory factors. Their model includes, for example, welfare loss due to socially suboptimal hydro reservoir usage, socially optimal electricity price, hydro reservoir storage and thermal reservoir storage; that are referred as outcomes. However, the model does not explain the real market condition but rather an ideal situation. In the model the market is controlled by one agent, i.e. one agent controls all the power generation reserves; it is referred to as a socially optimal strategy. Article by Kauppi and Liski (2008) includes an assumption where an individual agent has a certain fraction of market power, e.g. 20 % or 30 %. In order to maintain the focus of this thesis, this part of their paper is omitted. The goal of this thesis is two-fold. Firstly we expand the results from the socially optimal strategy for years 2006-08, as the earlier study finishes in 2005. The second objective is to improve on the methods from the previous study. This thesis results several outcomes (SPOT-price and welfare loss, etc.) due to socially optimal actions. Welfare loss is interesting as it describes the inefficiency of the market. SPOT-price is an important output for the market participants as it often has an effect on end users' electricity bills. Another function is to modify and try to improve the model by means of using more accurate input data, e.g. by considering pollution trade rights effect on input data. After modifications to the model, new welfare losses are calculated and compared with the same results before the modifications. The hydro reservoir has the higher explanatory significance in the model followed by thermal power. In Nordic markets, thermal power reserves are mostly nuclear power and other thermal sources (coal, natural gas, oil, peat). It can be argued that hydro and thermal reservoirs determine electricity supply. Roughly speaking, the model takes into account electricity demand and supply, and several parameters related to them (water inflow, oil price, etc.), yielding finally the socially optimal outcomes. The author of this thesis is not aware of any similar model being tested before. There have been some other studies that are close to the Kauppi and Liski (2008) model, but those have a somewhat different focus. For example, a specific feature in the model is the focus on long-run capacity usage that differs from the previous studies on short-run market power. The closest study to the model is from California's wholesale electricity markets that, however, uses different methodology. Work is constructed as follows.

Operationalizing Supply Chain vs. Supply Chain Competion

Competition is an immensely important area of study in economic theory, business and strategy. It is known to be vital in meeting consumers’ growing expectations, stimulating increase in the size of the market, pushing innovation, reducing cost and consequently generating better value for end users, among other things. Having said that, it is important to recognize that supply chains, as we know it, has changed the way companies deal with each other both in confrontational or conciliatory terms. As such, with the rise of global markets and outsourcing destinations, increased technological development in transportation, communication and telecommunications has meant that geographical barriers of distance with regards to competition are a thing of the past in an increasingly flat world. Even though the dominant articulation of competition within management and business literature rests mostly within economic competition theory, this thesis draws attention to the implicit shift in the recognition of other forms of competition in today’s business environment, especially those involving supply chain structures. Thus, there is popular agreement within a broad business arena that competition between companies is set to take place along their supply chains. Hence, management’s attention has been focused on how supply chains could become more aggressive making each firm in its supply chain more efficient. However, there is much disagreement on the mechanism through which such competition pitching supply chain against supply chain will take place. The purpose of this thesis therefore, is to develop and conceptualize the notion of supply chain vs. supply chain competition, within the discipline of supply chain management. The thesis proposes that competition between supply chains may be carried forward via the use of competition theories that emphasize interaction and dimensionality, hence, encountering friction from a number of sources in their search for critical resources and services. The thesis demonstrates how supply chain vs. supply chain competition may be carried out theoretically, using generated data for illustration, and practically using logistics centers as a way to provide a link between theory and corresponding practice of this evolving competition mode. The thesis concludes that supply chain vs. supply chain competition, no matter the conceptualization taken, is complex, novel and can be very easily distorted and abused. It therefore calls for the joint development of regulatory measures by practitioners and policymakers alike, to guide this developing mode of competition.

An Efficient Constraint Grammar Parser based on Inward Deterministic Automata

Pappret conceptualizes parsning med Constraint Grammar på ett nytt sätt som en process med två viktiga representationer. En representation innehåller lokala tvetydighet och den andra sammanfattar egenskaperna hos den lokala tvetydighet klasser. Båda representationer manipuleras med ren finite-state metoder, men deras samtrafik är en ad hoc -tillämpning av rationella potensserier. Den nya tolkningen av parsning systemet har flera praktiska fördelar, bland annat det inåt deterministiska sättet att beräkna, representera och räkna om alla potentiella tillämpningar av reglerna i meningen.