Abstract
The marketclearing price, in turn, is used to calculate the amount that will be paid to all generators whose bids were accepted. [...]if bids for a particular location at a particular time are $20, $40, and $70 per megawatt-hour, and only the first two bids need to be accepted to meet demand, the payment to both successful bidders will be based on the $40 bid. [...]allowing demand response resources to participate in the wholesale market mitigates the market power of wholesale suppliers of electricity.