Evidence of existence winner's curse between enterprises wind and photovoltaic power generators winners of the 8th reserve energy auction

Heitor Lopes Ferreira, Leandro Alves Patah, Ricardo Meirelles de Faria


Purpose – This article sought evidence of the existence of the as Winner's Curse, among the participants of the 8th Reserve Energy Auction promoted by Brazilian government.

Design/methodology/approach – In order to perform the study, we opted for the use of Multidimensional Scaling to identify groups that have similarities to search for evidence related to the Winner's Curse, characterizing it as descriptive quantitative research of an exploratory nature.

Findings – The results showed that among the 53 projects studied, thirteen are with their schedules delayed, pointing for possible asymmetries among the bidders related to the logistics of their enterprises. The results also calling into question the energy security strategy carried out by the Brazilian government, by allowing several ventures terminating their contracts, coulding also be evidence of the winner´s curse among the future winners of this new model of auction.

Research limitations/implications – The principal limitation is in the choice of only one Brazilian auction for explorer the auctions specially the auctions Brazilians energy.

Practical implications – In the practical implications that research demonstrated than bidders don't planned yours power plants, causing delays or suspension in constructions, evidence of possible existing winner's course in between bidders.

Originality/value – Too was demonstred than in a competition where the products are homogeneity, the example of the energy, the information, experience and relationship between competitors, can to do one enterprise win a auction; but if the anxiety for win is bigger, and doesn't consider basic aspects such as costs the company will have great difficulties in fulfilling its contracts and future sanctions may occur. 

Full Text:



Abbud, O. A., & Tancredi, M. (2010). Transformações Recentes da Matriz Brasileira de Geração de Energia Elétrica – Causas e Impactos Principais. Centro de Estudos Da Consultoria Do Senado. Brasil., 64.

Aflaki, S., & Netessine, S. (2017). Strategic Investment in Renewable Energy Sources: The Effect of Supply Intermittency. Manufacturing & Service Operations Management, 19(3), 489–507. https://doi.org/10.1287/msom.2017.0621

ANEEL. (2017a). Acompanhamento da Centrais Geradoras Eólicas.

ANEEL. (2017b). Acompanhamento das Centrais Geradoras Fotovoltaicas.

ANEEL. (2017c). BIG - Banco de Informações de Geração.

Bagnall, D., & Boreland, M. (2008). Photovoltaic technologies. Energy Policy, 36(12), 4390–4396. https://doi.org/10.1016/j.enpol.2008.09.070

Battigalli, P., & Siniscalchi, M. (2003). Rationalizable bidding in first-price auctions. Games and Economic Behavior, 45(1), 38–72. https://doi.org/10.1016/S0899-8256(02)00543-2

Borenstein, S. (2002). The Trouble With Electricity Markets: Understanding California’s Restructuring Disaster. Journal of Economic Perspectives, 16(1), 191–211. https://doi.org/10.1257/0895330027175

Borenstein, S., Bushnell, J., & Wolak, F. (2000). Diagnosing Market Power in California’s Restructured Wholesale Electricity Market. National Bureau of Economic Research Working Paper Series, No. 7868. https://doi.org/10.3386/w7868

Bruni, A. L. (2012). SPSS: Guia Prático para Pesquisadores. São Paulo: Atlas.

Bulow, J., & Klemperer, P. (1996). Auctions vs. negotiations. The American Economic Review, 86(1), 180–194. https://doi.org/10.1126/science.151.3712.867-a

CCEE. (2017a). Contratação de Energia Elétrica. São Paulo: Câmara de Comercialização de Energia Elétrica.

CCEE. (2017b). Resultado Consolidado de Leilões. São Paulo: Câmara de Comercialização de Energia Elétrica.

CCEE, C. de C. de E. E. (2019). Resultado Consolidado dos Leilões de Energia Elétrica. São Paulo.

Cooper, D. J., & Fang, H. (2008). Understanding overbidding in second price auctions: An experimental study. Economic Journal, 118(532), 1572–1595. https://doi.org/10.1111/j.1468-0297.2008.02181.x

Cox, J. C., Smith, V. L., & Walker, J. M. (1988). Theory and individual behavior of first-price auctions. Journal of Risk and Uncertainty, 1(1), 61–99. https://doi.org/10.1007/BF00055565

Dale, M., & Benson, S. M. (2013). Energy balance of the global photovoltaic (PV) industry -is the PV industry a net electricity producer? Environmental Science and Technology, 47(7), 3482–3489. https://doi.org/10.1021/es3038824

Decreto Lei 5163, B. (2004). DECRETO No 5.163, DE 30 DE JULHO DE 2004.

EPE. (2012). Análise da Inserção da Geração Solar na Matriz Elétrica Brasileira. Rio de Janeiro: Empresa de Pequisas Energéticas.

Ferreira, H. L., & Patah, L. A. (2017). Renewable energy: the role of the auctions of energy in Brazil and the acting of the sources of biomass. Revista Gestão & Tecnologia, 17(2), 51–65.

Filiz-Ozbay, E., & Ozbay, E. Y. (2007). Auctions with anticipated regret: Theory and experiment. American Economic Review. https://doi.org/10.1257/aer.97.4.1407

Hair, J. F., Black, W. C., Babin, B. J., Anderson, R. E., & Tatham, R. L. (2009). Analise multivariada de dados. Bookman. https://doi.org/10.1119/1.3129093

Justo, D. A. R. (2010). Estratégias em Leilões de Energia Elétrica. In Paper presented at the XIII Encontro Regional de Economia - ANPEC SUL 2010. Porto Alegre.

Karl, C. K. (2016). Investigating the Winner’s Curse Based on Decision Making in an Auction Environment. Simulation and Gaming, 47(3), 324–345. https://doi.org/10.1177/1046878116633971

Klemperer, P. (1998). Auctions with almost common values: The `Wallet Game’ and its applications. European Economic Review, 42(3–5), 757–769. https://doi.org/10.1016/S0014-2921(97)00123-2

Krishna, V. (2003). Auction Theory. Auction Theory. https://doi.org/10.1016/B978-0-12-426297-3.X5026-7

Larson, R., & Faber, B. (2010). Estatística Aplicada. São Paulo: Pearson Prentice Hall.

Li, G., Shi, J., & Qu, X. (2011). Modeling methods for GenCo bidding strategy optimization in the liberalized electricity spot market-A state-of-the-art review. Energy. https://doi.org/10.1016/j.energy.2011.06.015

Markard, J., Raven, R., & Truffer, B. (2012). Sustainability transitions: An emerging field of research and its prospects. Research Policy, 41(6), 955–967. https://doi.org/10.1016/j.respol.2012.02.013

Maurer, Luiz; Barroso, L. A. (2011). The World Bank. Washington, D.C.

Milgrom, P. R., & Weber, R. J. (1982). A Theory of Auctions and Competitive Bidding. Econometrica, 50(5), 1089. https://doi.org/10.2307/1911865

Nascimento, R. L. (2017). ENERGIA SOLAR NO BRASIL: SITUAÇÃO E PERSPECTIVAS, (55 61), 4. https://doi.org/10.1016/j.seta.2013.04.001

Nielsen, et al. (2010). Economy of Wind Turbines (Vindmøllers Økonomi). EUDP, Denmark.

Ockenfels, A., & Selten, R. (2005). Impulse balance equilibrium and feedback in first price auctions. Games and Economic Behavior, 51(1), 155–170. https://doi.org/10.1016/j.geb.2004.04.002

Parsons, S., & Klein, M. (2011). Auctions and bidding : A guide for computer scientists. ACM Computing Surveys (CSUR), 43(2), 10. https://doi.org/10.1145/1883612.1883617

Pla, A., López, B., Murillo, J., & Maudet, N. (2014). Multi-attribute auctions with different types of attributes: Enacting properties in multi-attribute auctions. Expert Systems with Applications, 41(10), 4829–4843. https://doi.org/10.1016/j.eswa.2014.02.023

Rego, E. E., & Parente, V. (2013). Brazilian experience in electricity auctions: Comparing outcomes from new and old energy auctions as well as the application of the hybrid Anglo-Dutch design. Energy Policy, 55, 511–520. https://doi.org/10.1016/j.enpol.2012.12.042

Roider, A., & Schmitz, P. W. (2012). Auctions with Anticipated Emotions: Overbidding, Underbidding, and Optimal Reserve Prices. Scandinavian Journal of Economics, 114(3), 808–830. https://doi.org/10.1111/j.1467-9442.2012.01709.x

Schleicher-Tappeser, R. (2012). How renewables will change electricity markets in the next five years. Energy Policy, 48, 64–75. https://doi.org/10.1016/j.enpol.2012.04.042

Steiner, J., & Stewart, C. (2016). Perceiving prospects properly. American Economic Review, 106(7), 1601–1631. https://doi.org/10.1257/aer.20141141

Thaler, R. H. (1988). Anomalies: The Winner’s Curse. Journal of Economic Perspectives, 2(1), 191–202. https://doi.org/10.1257/jep.2.1.191

Vaisala. (2015). Global Solar Map. Retrieved from https://www.vaisala.com/en/lp/free-wind-and-solar-resource-maps

Yu, N., & Foggo, B. (2017). Stochastic valuation of energy storage in wholesale power markets. Energy Economics, 64, 177–185. https://doi.org/10.1016/j.eneco.2017.03.010

DOI: https://doi.org/10.5902/1983465932720

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.






Revista de Administração da UFSM. Brazilian Journal of Management

Universidade Federal de Santa Maria, Santa Maria, Rio Grande do Sul, Brasil, eISSN 1983-4659