Biomethane Auction Model

Against this background, the auction modelling procedure is divided into the following steps:

• Competition analysis: In order to obtain an assessment of the probability of participation of individual plants, a detailed competition analysis is carried out. Market research and current data surveys from the plant register serve as a basis.
• Indifference price determination: To derive potential minimum bids for the plants, an estimate of the cost and revenue situation for the individual projects is made.
• Auction simulation: The determined bid and corresponding bid prices are combined in the simulation of the bidding round (“Monte Carlo simulation”). The bidding behaviour of the market participants is varied in different scenarios. The Monte Carlo approach used allows the quantification of existing uncertainties.
• Bid optimisation: On the basis of the market simulation, the probability of acceptance of a bid is analysed for different bid levels. The results form the basis for the development of a promising bidding strategy. The result of the auction modelling is, among other things, an estimate of the bid with which a power plant can enter a bidding round.

The enervis auction model for the biomethane tender is successfully established on the market and enables a well-founded forecast of the tender results on the basis of our energy industry know-how and the detailed analysis of competitive structures.

We would be happy to support you with our energy industry expertise and our models in determining a suitable bidding strategy. For further information and queries, please do not hesitate to contact us.