Network Procurement Auctions

Abstract

In most network asset procurement exercises, network configurations are predefined by the auctioneers. Bidders can neither propose different network configurations nor can they submit bids on a group of network links. We believe the market itself can be designed better. We present a lot structure and an auction design where bidders might propose and build different network configurations and where bidding for packages is a possibility. We demonstrate why the auction design in this paper should be considered for future network procurement exercises through an example, inspired by UK offshore electricity transmission assets, to illustrate our idea.