Forecasting Competition in the Electricity Market of Greece: a Prey-Predator Approach

This paper studies and forecasts the evolution of concentration of Greek energy market, expressed by market shares of operators. The evolution of liberalization process of the Greek electricity market is dynamically estimated based on concepts of population biology, according to specific data for providers’ market shares. Using the Lotka–Volterra model and Integral method to determine the unknown parameters, the methodology of prey-predator model is applied to describe the competition among Greek alternative electricity providers, towards obtaining a larger market share from the common source of electrical energy of current dominant provider and future adopters. The proposed model managed to validate the available statistical data for the examined case study and is proven to be suitable for forecasting market concentration and equilibrium in electricity area. The evaluation reveals that the market share of the incumbent operator is expected to remain quite high by the year 2020 and this is why the application of a cropping strategy is proposed in order to reduce its share to 50% complied with European directions and ensure smooth coexistence of the two interacting species. The described methodology can become a powerful managerial tool for decision-makers and providers in order to drive performance and price competitiveness.