Research on identification of operation state in electricity market

Abstract

Identification of power market operation state is of importance to hedging market risk. Based on Dr. Dyliacco's research, the paper presents a new series of key index to identify the operation state of power market by a brief survey of the determining method of power market state. The decision tree method is applied in order to deal with the large quantity and complexity of index. Furthermore, the algorithm based on the information entropy is used to learn from a set of typical examples and thus to form the decision tree to identify the unknown state. The numeric analysis is carried out based on the data of California electricity market of 2000. The results show that the proposed methods can provide with the reasonable results in accord with reality and prove the effectiveness of the methods in market state identification and pre-warning.