Abstract

The article analyses a theoretical framework to determine a policy of assignation of obtainable savings in a hypothetical economy i nterchange between the Chilean and Argentine electric power systems. The interconnection is considered as the next step in the evolution experimented by the Electric Energy Markets (EEM) of both countries, towards the same mode of Wholesale Competitive EEM. The application of the generalised solution of the Nash bargaining is analysed correspondg ng to the different "negotiation powers" as well as the effect of the "risk aversion" of the corresponding di spatch centres to the results of the simulation of the annual operation of the interconnected systems under different scenarios. This policy favours the Argentine EEM. © 2000 Elsevier Science Ltd. All rights reserved.