Search results for: energy markets

Authors: Mykola G. Boichuk

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The paper concerns predatory pricing incentives and mechanisms in the markets of services, as well as its anti-competitive effects. As cost estimation at services markets is more complex in comparison to markets of goods, predatory pricing is more difficult to detect in the provision of services. For instance, this is often the case for professional services, which is analyzed in the paper. The special attention is given to employment markets as de-facto main supply markets for professional services markets. Also, the paper concerns such instances as travel agents' services, where predatory pricing may have implications not only on competition but on a wider range of public interest as well. Thus, the paper develops on effective ways to apply competition law rules on predatory pricing to the provision of services.

Keywords: employment markets, predatory pricing, services markets, unfair competition

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Authors: Adedeji Tejumola Olugboja

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Night markets are physical locations in residential neighbourhoods where market parties interact. It is a kind of market where marketing activities commence by 6pm until after midnight. The problem of the study is to assess marketing activities in the night markets. Specific objectives for this study include determining volume of business activities, numbers of market parties etc in the selected night markets. The purposive sampling technique is adopted for this study and the four night markets in the area of study are selected as sample: Aggregate of 173 retailers and an average of 2583 consumers daily operate in these night markets. The use of tables, simple percentage and descriptive statistics were employed for data analysis and presentation. Findings revealed volume of marketing activities, sales per night, profit per night and savings per day in each of these night markets. Government should erect street lights and repair damaged ones in these night markets to make night markets more lucrative.

Keywords: marketing activities, night markets, Nigerian economy

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Authors: Yusuf Seedat

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The necessity to understand global financial markets has increased following the unfortunate spread of the recent financial crisis around the world. Financial markets are considered to be complex systems consisting of highly volatile move-ments whose indexes fluctuate without any clear pattern. Analytic methods of stock prices have been proposed in which financial markets are modeled using common network analysis tools and methods. It has been found that two key components of social network analysis are relevant to modeling financial markets, allowing us to forecast accurate predictions of stock prices within the financial market. Financial markets have a number of interacting components, leading to complex behavioral patterns. This paper describes a social network approach to analyzing financial markets as a viable approach to studying the way complex stock markets function. We also look at how social network analysis techniques and metrics are used to gauge an understanding of the evolution of financial markets as well as how community detection can be used to qualify and quantify in-fluence within a network.

Keywords: network analysis, social networks, financial markets, stocks, nodes, edges, complex networks

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Authors: Vera Jancurova

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The financial theory is dominated by the believe that weekday effect has disappeared from current markets. The purpose of this article is to study anomalies, especially weekday effect, at real markets that disrupt the efficiency of financial markets. The research is based on the analyses of historical daily exchange rates of significant world indices to determine the presence of weekday effects on financial markets. The methodology used for the study is based on the analyzes of daily averages of particular indexes for different time periods. Average daily gains were analyzed for their whole time interval and then for particular five and ten years periods with the aim to detect the presence on current financial markets. The results confirm the presence of weekday effect at the most significant indices - for example: Nasdaq, S & P 500, FTSE 100 and the Hang Seng. It was confirmed that in the last ten years, the weekend effect disappeared from financial markets. However in last year’s the indicators show that weekday effect is coming back. The study shows that weekday effect has to be taken into consideration on financial markets, especially in the past years.

Keywords: indices, anomalies, behavioral finance, weekday effect

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Authors: Aslam Faheem, Hunjra Ahmed Imran, Tayachi Tahar, Verhoeven Peter, Tariq Yasir

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We investigate the evidence of three risk-adjusted calendar anomalies in eight frontier markets. Our sample consists of the daily closing prices of their stock indices for the period of January 2006 to September 2019. We categorize the data with respect to day-of-the-week, Lunar calendar and Islamic calendar. Using Morgan Stanley Capital International (MSCI) eight Markets Index as our proxy of the market portfolio, most of the frontier markets tested exhibit calendar seasonality. We confirm that systematic risk varies with respect to day-of-the-week, Lunar months and Islamic months. After consideration of time-varying risk and applying Bonferroni correction, few frontier markets exhibit profitable investment opportunities from calendar return anomalies for active investment managers.

Keywords: asset pricing, frontier markets, market efficiency, Islamic calendar effects, Islamic stock markets

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Authors: Abdulrahman M. Alsuhaibani, Martin Maken

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FACTS devices have great influence on the grid stability and power markets price. Recently, there is intent to integrate a large scale of renewable energy sources to the power system which in turn push the power system to operate closer to the security limits. This paper discusses the power system stability and reliability improvement that could be achieved by using FACTS. There is a comparison between FACTS devices to evaluate their performance for different functions. A case study has also been made about its effect on reducing generation cost and minimizing transmission losses which have good impact on efficient and economic operation of electricity markets

Keywords: FACTS, grid stability, spot price, OPF

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Authors: Fahad Ahmed Qureshi

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There were abundant renowned financial markets in Pre-Islamic Arabs. Most of those were patterned and settled during pre-particularized sunshine. Those markets were classified either as vernacular markets helping the neighboring clans, or habitual markets that people sojourned to from all articulations of the Arabian Peninsula, such as Okaz near Mecca. Some of those markets had leading significance due to their geographical positions, such as Prime market of Eden, because of their entanglement in international trade i.e. with the markets of Sub-Continent, Abyssinia, Persia and China. Other markets such as Market of Yamamah annex its gist from being situated on the caravan crossroads. Islamic worldview and Islamic epistemology base of Financial Market’s realistic theory, pragmatic model and operative approach is moderately constrained in terms of its growth. The existent situation only parasol the form of accommodative-modification and splendid-methodologies, which due to depleted and decorous endeavor in explaining Islamic financial market theoretically. This is the demand of time that particular studies should be conduct to magnify the devours in developing theoretical framework for Islamic Financial Market.

Keywords: Islam, financial market, history, research, product development

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Authors: Amirmohsen Behjat, Aleck Ostry, Christina Miewald, Bernie Pauly

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Farmers’ Markets have become one of the important healthy food suppliers in both rural communities and urban settings. Farmers’ markets are evolving and their number has rapidly increased in the past decade. Despite this drastic increase, the distribution of the farmers’ markets is not even across different areas. The main goal of this study is to explore the socioeconomic, geographic, and demographic variables which affect the establishment of farmers’ market in rural communities in British Columbia (BC). Thus, the data on available farmers’ markets in rural areas were collected from BC Association of Farmers’ Markets and spatially joined to BC map at Dissemination Area (DA) level using ArcGIS software to link the farmers’ market to the respective communities that they serve. Then, in order to investigate this issue and understand which rural communities farmer’ markets tend to operate, a binary logistic regression analysis was performed with the availability of farmer’ markets at DA-level as dependent variable and Deprivation Index (DI), Metro Influence Zone (MIZ) and population as independent variables. The results indicated that DI and MIZ variables are not statistically significant whereas the population is the only which had a significant contribution in predicting the availability of farmers’ markets in rural BC. Moreover, this study found that farmers’ markets usually do not operate in rural food deserts where other healthy food providers such as supermarkets and grocery stores are non-existent. In conclusion, the presence of farmers markets is not associated with socioeconomic and geographic characteristics of rural communities in BC, but farmers’ markets tend to operate in more populated rural communities in BC.

Keywords: farmers’ markets, socioeconomic and demographic variables, metro influence zone, logistic regression, ArcGIS

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Authors: Meltem Gurunlu

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One of the central problems in corporate finance is the allocation of funds. This usually takes two forms: allocation of funds across firms in an economy or allocation of funds across projects or business units within a firm. The first one is typically related to the external markets (the bond market, the stock market, banks and finance companies) whereas the second form of the capital allocation is related to the internal capital markets in which corporate headquarters allocate capital to their business units. (within-group transfers, within-group credit markets, and within-group equity market). The main aim of this study is to investigate the nature of capital allocation dynamics by comparing the relevant studies carried out on external and internal capital markets with paying special significance to the business groups.

Keywords: internal capital markets, external capital markets, capital structure, capital allocation, business groups, corporate finance

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Authors: Hailu Getnet

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This study focus on reverse innovation on performance outcomes across developed and subsistence markets context. The subsistence market consists two third of the world population and the largest international market. To date, it has been neglected because of its issues of perceived challenges and seeming unattractiveness compared to the established markets in the west. However, subsistence markets are becoming source of reverse innovation; an innovation that is likely to be adopted first in developing world and successfully traded globally. In response, there is a growing interest on reverse innovation to power the future. Based on the theories of innovation and growing subsistence market literatures, the study propose drivers and outcomes of reverse innovation, a potential similarities and difference in benefiting and challenging firms and consumers in subsistence and developed markets.

Keywords: reverse innovation, subsistence market, developing world, developed market

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Authors: Mohammad Hossein Ranjbar, Mahdi Bagheri, B. Shivaraj

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This study attempts to investigate the relationship between stock market of Iran and GCC countries stock exchanges. Eight markets were included: the stock market of Iran, Kuwait, Bahrain, Qatar, Saudi Arabia, Dubai, Abu Dhabi and Oman. Daily country market indices were collected from January 2005 to December 2010. The potential time-varying behaviors of long-run stock market relationship among selected markets are tested applying correlation test, Augmented Dick Fuller test (ADF), Bilateral and Multilateral Cointegration (Johansen), and the Granger Causality test. The findings suggest that stock market of Iran is negatively correlated with most of the selected markets in the whole duration. But contemporaneous correlations among the eight selected markets are increased positively in period of financial crises. Bilateral Cointegration between selected markets suggests that there is no integration between Tehran stock exchange and other selected markets. Among other markets, except the stock market of Dubai and Abu Dhabi as a one pair, are not cointegrated in whole, but in duration of financial crises integration between selected markets are increased. Finally, investigation of the casual relationship among eight financial markets suggests there are unidirectional and bidirectional causal relationship among some of stock market indices.

Keywords: financial crises, Middle East, stock market integration, Granger Causality test, ARDL test

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Authors: Sara Ali Alokley, Mansour Saleh Albarrak

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This paper investigates the dependency or clustering of extremes in the financial returns data by estimating the extremal index value θ∈[0,1]. The smaller the value of θ the more clustering we have. Here we apply the method of Ferro and Segers (2003) to estimate the extremal index for a range of threshold values. We compare the dependency structure of extremes in the developed and emerging markets. We use the financial returns of the stock market index in the developed markets of US, UK, France, Germany and Japan and the emerging markets of Brazil, Russia, India, China and Saudi Arabia. We expect that more clustering occurs in the emerging markets. This study will help to understand the dependency structure of the financial returns data.

Keywords: clustring, extremes, returns, dependency, extermal index

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Authors: Saeed Mohammadirad

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During the first commitment period of the Kyoto Protocol, many developed countries were forced to restrict carbon emissions. Although Iran was one of the countries of Kyoto protocol, due to some special conditions, it was not required to restrict its carbon emissions. Flexible mechanisms were developed to assist countries responsible for reducing their carbon emissions, and regulated carbon markets were introduced. Carbon credits which are provided by organizations in countries with no responsibility to restrict their carbon emissions are traded in voluntary markets. This study focuses on how to measure and report the carbon allowances and carbon credits from accounting view point under both regulated and voluntary markets.

Keywords: carbon credits, carbon markets, accounting, flexible mechanisms

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Authors: Young Sik Kim, Tae Kwon Ha

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This article considers the problems of economic growth and Russian energy strategy. Also in this paper, the issues related to the economic growth prospects of Russian were discussed. Russian energy strategy without standing Russia`s stature in global energy markets, at the current production and extraction rates, will not be able to sustain its own production as well as fulfil its energy strategy. Indeed, Russia’s energy sector suffers from a chronic lack of investments which are necessary to modernize its energy supply system. In recent years, especially since the international financial crisis, Russia-EU energy cooperation has made substantive progress. Recently the break-through progress has been made, resulting mainly from long-term contributing factors between the countries and recent international economic and political situation changes. Analytical material presented in the article is intended for a more detailed or substantive analysis related to foreign economic relations of the countries and Russia as well.

Keywords: Russia, energy strategy, economic growth, cooperation

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Authors: Saba Arif, Anam Nadeem, Roman Kalvin, Tanzeel Rashid, Burhan Ali, Juntakan Taweekun

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Currently, the energy crisis is taking serious attention. Globally, industries and building are major share takers of energy. 72% of total global energy is consumed by residential houses, markets, and commercial building. Additionally, in appliances air conditioners are major consumer of electricity; about 60% energy is used for cooling purpose in houses due to HVAC units. Energy demand will aid in determining what changes will be needed whether it is the estimation of the required energy for households or instituting conservation measures. Bottom-up model is one of the most famous methods for forecasting. In current research bottom-up model of air conditioners' energy consumption in all income classes in comparison with seasonal variation and hourly consumption is calculated. By comparison of energy consumption of all income classes by usage of air conditioners, total consumption of actual demand and current availability can be seen.

Keywords: air conditioning, bottom up model, income classes, energy demand

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Authors: Shota Gulbani

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At the present stage, for the countries with developing economies, studying, and researching financial markets, gains special importance, because the situation of financial markets shapes an exact views about the carried out economic policy of the country. Besides, it’s unimaginable any country with developed economy, without healthy and functioning financial markets, whereas, for any kind of business it has got a great importance in terms of finding diversified and alternative capital. In this regard; it should be noted that the segments of Georgian financial markets are developed quite unequally, as evidenced by the fact that the Georgian financial sector is represented by 93% of commercial banks, what does not create an conformable environment for non-bank financial institutions development. In spite of the fact that Georgia has got one of the best banking system of region, it is important to properly analyze that this system should not hinder the development of other participants of Georgian financial sector.

Keywords: financial markets, macroeconomics, investments, stock exchange

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Authors: J. Gochermann

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German energy market is under historical change. Turning-off the nuclear power plants and intensive subsidization of the renewable energies causes a paradigm change from big central energy production and distribution to more local structures, bringing the energy production near to the consumption. The formerly big energy market with only a few big energy plants and grid operating companies is changing into a disperse market with growing numbers of small and medium size companies (SME) generating new value-added products and services. This change in then energy market, in Germany called the “Energiewende”, inverts also the previous innovation system. Big power plants and large grids required also big operating companies. Innovations in the energy market focused mainly on big projects and complex energy technologies. Innovation in the new energy market structure is much more dispersed. Increasing number of SME is now able to develop energy production and storage technologies, smart technologies to control the grids, and numerous new energy related services. Innovation is now regional distributed, which is a remarkable problem for the old big energy companies. The paper will explain the change in the German energy market and the paradigm change as well as the consequences for the innovation structure in the German energy market. It will show examples how SME participate from this change and how innovation systems, as well for the big companies and for SME, can be adapted.

Keywords: changing energy markets, disperse innovation, new value-added products and services, SME

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Authors: Marin Mandić, Elis Sutlović, Tonći Modrić, Luka Stanić

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With the restructuring and deregulation of the power system, storage owners, generation companies or private producers can offer their multiple services on various power markets and earn income in different types of markets, such as the day-ahead, real-time, ancillary services market, etc. During the COVID-19 pandemic, electricity prices, as well as ancillary services prices, increased significantly. The optimization of the energy storage operation was performed using a suitable model for simulating the operation of a pumped storage hydropower plant under market conditions. The objective function maximizes the income earned through energy arbitration, regulation-up, regulation-down and spinning reserve services. The optimization technique used for solving the objective function is mixed integer linear programming (MILP). In numerical examples, the pumped storage hydropower plant operation has been optimized considering the already achieved hourly electricity market prices from Nord Pool for the pre-pandemic (2019) and the pandemic (2020 and 2021) years. The impact of the electricity market prices during the COVID-19 pandemic on energy storage operation is shown through the analysis of income, operating hours, reserved capacity and consumed energy for each service. The results indicate the role of energy storage during a significant fluctuation in electricity and services prices.

Keywords: electrical market prices, electricity market, energy storage optimization, mixed integer linear programming (MILP) optimization

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Authors: Kamel Malik Bensafta, Gervasio Bensafta

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The purpose of this paper is to investigate the relationship between oil prices and socks markets. The empirical analysis in this paper is conducted within the context of Multivariate GARCH models, using a transform version of the so-called BEKK parameterization. We show that mean and uncertainty of US market are transmitted to oil market and European market. We also identify an important transmission from WTI prices to Brent Prices.

Keywords: oil volatility, stock markets, MGARCH, transmission, structural break

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Authors: Y. Boulaksil, J. C. Fransoo, E.E. Blanco, S. Koubida

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In this paper, we study the small traditional retailers that are located in the neighborhoods of big cities in emerging markets. Although modern retailing has grown in the last two decades in these markets, the number of small retailers is still increasing and serving a substantial part of the daily demand for many basic products, such as bread, milk, and cooking oil. We conduct an empirical study to understand the business environment of these small traditional retailers in emerging markets by collecting data from 333 small retailers, spread over 8 large cities in Morocco. We analyze the data and describe their business environment with a focus on the informal credits they offer to their customers. We find that smaller small retailers that are funded from personal savings and managed by the owner himself offer relatively the most credits. Our study also provides interesting insights about these small retailers that will help FMCG manufacturers that are (planning to be) active in Morocco and other emerging markets. We also discuss a number opportunities to improve the efficiency of the supply chains that serve them.

Keywords: small retailers, big cities, emerging markets, empirical study, supply chain management, Morocco

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Authors: Ilaria Lucrezia Amerise

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Electricity markets throughout the world have undergone substantial changes. Accurate, reliable, clear and comprehensible modeling and forecasting of different variables (loads and prices in the first instance) have achieved increasing importance. In this paper, we describe the actual state of the art focusing on reg-SARMA methods, which have proven to be flexible enough to accommodate the electricity price/load behavior satisfactory. More specifically, we will discuss: 1) The dichotomy between point and interval forecasts; 2) The difficult choice between stochastic (e.g. climatic variation) and non-deterministic predictors (e.g. calendar variables); 3) The confrontation between modelling a single aggregate time series or creating separated and potentially different models of sub-series. The noteworthy point that we would like to make it emerge is that prices and loads require different approaches that appear irreconcilable even though must be made reconcilable for the interests and activities of energy companies.

Keywords: interval forecasts, time series, electricity prices, reg-SARIMA methods

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Authors: Jitendra Aswani

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In the first section of this study, impact of Global Financial Crisis (GFC) on the synchronization of fourteen Asian Stock Markets (ASM’s) of countries like Hong Kong, India, Thailand, Singapore, Taiwan, Pakistan, Bangladesh, South Korea, Malaysia, Indonesia, Japan, China, Philippines and Sri Lanka, has been analysed using the network science and its metrics like degree of node, clustering coefficient and network density. Then in the second section of this study by introducing the US stock market in existing network and developing a Minimum Spanning Tree (MST) spread of crisis from the US stock market to Asian Stock Markets (ASM) has been explained. Data used for this study is adjusted the closing price of these indices from 6th January, 2000 to 15th September, 2013 which further divided into three sub-periods: Pre, during and post-crisis. Using network analysis, it is found that Asian stock markets become more interdependent during the crisis than pre and post crisis, and also Hong Kong, India, South Korea and Japan are systemic important stock markets in the Asian region. Therefore, failure or shock to any of these systemic important stock markets can cause contagion to another stock market of this region. This study is useful for global investors’ in portfolio management especially during the crisis period and also for policy makers in formulating the financial regulation norms by knowing the connections between the stock markets and how the system of these stock markets changes in crisis period and after that.

Keywords: global financial crisis, Asian stock markets, network science, Kruskal algorithm

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Authors: Kamel Malik Bensafta, Gervasio Semedo

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The purpose of this paper is to investigate the relationship between oil prices and socks markets. The empirical analysis in this paper is conducted within the context of Multivariate GARCH models, using a transform version of the so-called BEKK parameterization. We show that mean and uncertainty of US market are transmitted to oil market and European market. We also identify an important transmission from WTI prices to Brent Prices.

Keywords: oil volatility, stock markets, MGARCH, transmission, structural break

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Authors: Ali Meawad Ahmad, Hosny A. Abdelrahman

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Chicken meat is a good source of protein of high biological value which contains most of essential amino-acids with high proportion of unsaturated fatty acids and low cholesterol level. Besides, it contain many vitamins as well as minerals which are important for the human body. Therefore, a total of 150 frozen chicken meat product samples, 800g each within their shelf-life, were randomly collected from commercial markets from Egypt (75 samples) and Saudi Arabian (75 samples) for chemical evaluation. The mean values of fat% in the examined samples of Egyptian and Saudi markets were 16.0% and 4.6% for chicken burger; 15.0% and 11% for nuggets and 11% and 11% for strips respectively. The mean values of moisture % in the examined samples of Egyptian and Saudi markets were 67.0% and 81% for chicken burger; 66.0% and 78% for nuggets and 71.0% and 72% for strips respectively. The mean values of protein % in the examined samples of Egyptian and Saudi markets were 15% and 17% for chicken burger; 16% and 16% for nuggets and 16% and 17% for strips respectively. The obtained results were compared with the Egyptian slandered and suggestions for improving the chemical quality of chicken products were given.

Keywords: chicken meat, nutrition, Egypt, markets

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Authors: Abdullah M. Algarni, Yashwant K. Malaiya

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Some of the key aspects of vulnerability-discovery, dissemination, and disclosure-have received some attention recently. However, the role of interaction among the vulnerability discoverers and vulnerability acquirers has not yet been adequately addressed. Our study suggests that a major percentage of discoverers, a majority in some cases, are unaffiliated with the software developers and thus are free to disseminate the vulnerabilities they discover in any way they like. As a result, multiple vulnerability markets have emerged. In some of these markets, the exchange is regulated, but in others, there is little or no regulation. In recent vulnerability discovery literature, the vulnerability discoverers have remained anonymous individuals. Although there has been an attempt to model the level of their efforts, information regarding their identities, modes of operation, and what they are doing with the discovered vulnerabilities has not been explored. Reports of buying and selling of the vulnerabilities are now appearing in the press; however, the existence of such markets requires validation, and the natures of the markets need to be analysed. To address this need, we have attempted to collect detailed information. We have identified the most prolific vulnerability discoverers throughout the past decade and examined their motivation and methods. A large percentage of these discoverers are located in Eastern and Western Europe and in the Far East. We have contacted several of them in order to collect first-hand information regarding their techniques, motivations, and involvement in the vulnerability markets. We examine why many of the discoverers appear to retire after a highly successful vulnerability-finding career. The paper identifies the actual vulnerability markets, rather than the hypothetical ideal markets that are often examined. The emergence of worldwide government agencies as vulnerability buyers has significant implications. We discuss potential factors that can impact the risk to society and the need for detailed exploration.

Keywords: risk management, software security, vulnerability discoverers, vulnerability markets

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Authors: Walid Chkili

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This paper investigates the dynamic relationship between gold and stock markets using data for BRICS counties. For this purpose, we estimate three multivariate GARCH models (namely CCC, DCC and BEKK) for weekly stock and gold data. Our main objective is to examine time variations in conditional correlations between the two assets and to check the effectiveness use of gold as a hedge for equity markets. Empirical results reveal that dynamic conditional correlations switch between positive and negative values over the period under study. This correlation is negative during the major financial crises suggesting that gold can act as a safe haven during the major stress period of stock markets. We also evaluate the implications for portfolio diversification and hedging effectiveness for the pair gold/stock. Our findings suggest that adding gold in the stock portfolio enhance its risk-adjusted return.

Keywords: gold, financial markets, hedge, multivariate GARCH

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Authors: Jan Cernohorsky

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This article aims to assess the evolution of imperfect competition in selected banking markets, in particular in the banking markets of Slovakia, Poland, Hungary, Slovenia and Croatia. Another objective is to assess the evolution of the relationship of imperfect competition and profit development in the banking markets. The article first provides an overview of literature on the topic. It then measures the degree of imperfect competition in individual markets using the Herfindahl-Hirschman Index. The commonly used indicator of total assets was chosen as an indicator. Based on this measurement, the individual banking sectors are categorized into theoretical definitions of the various types of imperfect competition - namely all surveyed banking sectors falling within the theoretical definition of monopolistic competition. Subsequently, using correlation analysis, i.e., the Pearson correlation coefficient, or the Spearman correlation coefficient, the connection between the evolution of imperfect competition and the development of the gross profit on selected banking markets was surveyed. It was found that with the exception of the banking market in Slovenia, where there is a positive correlation; there is no correlation between the evolution of imperfect competition and profit development in the selected markets. This means a recommendation for the regulators that it is not appropriate to rationalize a higher degree of regulation in granting banking licenses on the size of the profits attained in the banking market, as the relationship between the degree of concentration in the banking market and the amount of profit according to our measurements does not exist.

Keywords: bank, banking system, imperfect competition, profitability

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Authors: Mohammed Bou-Rabee

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The significance of wind energy is rising as the global world shifts toward clean and renewable energy sources. Wind energy generates electricity without releasing greenhouse gases, making it a feasible substitute for fossil fuels. This contributes to the reduction of carbon emissions, mitigates climate change, and enhances air quality. Wind energy, unlike fossil fuels, is a renewable resource. Investing in wind energy allows nations to reduce their reliance on imported fossil fuels, improving their energy security. This technique ensures stable energy costs while safeguarding economies from the volatility of oil and gas markets. Recent technological advancements have markedly decreased the cost of wind energy over the past few decades, establishing it as one of the most cost-effective sources of new electricity in many regions globally. These advancements have significantly enhanced turbine efficiency, augmented energy output, and reduced costs. The fluctuating characteristics of wind energy present an ongoing research challenge that has captivated the whole scientific community. Accurate forecasting of wind energy is essential for effective wind farm operation and management, smart grid stabilization, optimizing energy storage, investment and financial planning, and improved participation in energy markets. The extraction of wind energy depends on several factors, with wind speed being the most critical, as it directly affects the power output of a wind turbine. A wind turbine generates energy exponentially with wind velocity, exhibiting a cubic relationship. In addressing these research challenges, we have developed an efficient wind speed forecasting system employing advanced machine learning (ML) and statistical techniques. We created a hybrid time series forecasting model using an ensemble learning approach that integrates a Light Gradient Boosting Machine (LGBoost), Extreme Gradient Boosting (XGBoost), and Bayesian Linear Regression (BLR). We then utilized the Random Forest (RF) technique for feature selection. The model can predict wind speed with a minimum mean square error (MSE) of 0.096 and a maximum R² score of 0.924.

Keywords: wind energy, renewable resource, turbine efficiency, affects power

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Authors: Eduardo Rodrigues, Gisela Mendes, José M. Torres, José E. Sousa

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In the sequence of the liberalisation of the electricity sector a progressive engagement of consumers has been considered and targeted by sector regulatory policies. With the objective of promoting market competition while protecting consumers interests, by transferring some of the upstream benefits to the end users while reaching a fair distribution of system costs, different market models to value consumers’ demand flexibility at the energy community level are envisioned. Local Energy and Flexibility Markets (LEFM) involve stakeholders interested in providing or procure local flexibility for community, services and markets’ value. Under the scope of DOMINOES, a European research project supported by Horizon 2020, the local market concept developed is expected to: • Enable consumers/prosumers empowerment, by allowing them to value their demand flexibility and Distributed Energy Resources (DER); • Value local liquid flexibility to support innovative distribution grid management, e.g., local balancing and congestion management, voltage control and grid restoration; • Ease the wholesale market uptake of DER, namely small-scale flexible loads aggregation as Virtual Power Plants (VPPs), facilitating Demand Response (DR) service provision; • Optimise the management and local sharing of Renewable Energy Sources (RES) in Medium Voltage (MV) and Low Voltage (LV) grids, trough energy transactions within an energy community; • Enhance the development of energy markets through innovative business models, compatible with ongoing policy developments, that promote the easy access of retailers and other service providers to the local markets, allowing them to take advantage of communities’ flexibility to optimise their portfolio and subsequently their participation in external markets. The general concept proposed foresees a flow of market actions, technical validations, subsequent deliveries of energy and/or flexibility and balance settlements. Since the market operation should be dynamic and capable of addressing different requests, either prioritising balancing and prosumer services or system’s operation, direct procurement of flexibility within the local market must also be considered. This paper aims to highlight the research on the definition of suitable DR models to be used by the Distribution System Operator (DSO), in case of technical needs, and by the retailer, mainly for portfolio optimisation and solve unbalances. The models to be proposed and implemented within relevant smart distribution grid and microgrid validation environments, are focused on day-ahead and intraday operation scenarios, for predictive management and near-real-time control respectively under the DSO’s perspective. At local level, the DSO will be able to procure flexibility in advance to tackle different grid constrains (e.g., demand peaks, forecasted voltage and current problems and maintenance works), or during the operating day-to-day, to answer unpredictable constraints (e.g., outages, frequency deviations and voltage problems). Due to the inherent risks of their active market participation retailers may resort to DR models to manage their portfolio, by optimising their market actions and solve unbalances. The interaction among the market actors involved in the DR activation and in flexibility exchange is explained by a set of sequence diagrams for the DR modes of use from the DSO and the energy provider perspectives. • DR for DSO’s predictive management – before the operating day; • DR for DSO’s real-time control – during the operating day; • DR for retailer’s day-ahead operation; • DR for retailer’s intraday operation.

Keywords: demand response, energy communities, flexible demand, local energy and flexibility markets

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Authors: Aparna Viswanath

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Electricity spot prices are highly volatile under optimal generation capacity scenarios due to factors such as non-storability of electricity, peak demand at certain periods, generator outages, fuel uncertainty for renewable energy generators, huge investments and time needed for generation capacity expansion etc. As a result market participants are exposed to price and volume risk, which has led to the development of risk management practices. This paper provides an overview of risk management practices by market participants in electricity markets using financial derivatives.

Keywords: financial derivatives, forward, futures, options, risk management

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