  To meet carbon emission targets, governments around the world seek
electricity consumers to invest in self-sufficiency technologies such as solar
photovoltaic and battery storage. Such behaviour is sought in markets typically
characterised by an oligopoly amongst generating firms. In this work, we study
the interactions between investment decisions on the demand side and the supply
side, and we investigate how price-making behaviour on the supply side affects
these interactions compared to a situation with perfect competition. To do so,
we introduce a novel stochastic mixed complementarity problem to model several
players in an oligopolistic electricity market. On the supply side, we consider
generating firms who make operational and investment decisions. On the demand
side, we consider both industrial and residential consumers, each of whom may
invest in self-sufficiency technologies. The uncertainties of wind and solar
generation are the sources of the model's stochasticity. We apply the model to
a case study of a stylised Irish electricity system in 2030. Our results
demonstrate that price-making on the supply side increases investment in
self-sufficiency on the demand side, leading to a reduction in prices and
carbon emissions. We also find that both market power and self-sufficiency
alter the investment and decommissioning decisions made by generation firms.
Counter-intuitively, we also observe that the absence of a feed-in premium
increases investment in solar generation on the demand side. Our findings
highlight the importance of including both demand and supply side investment in
models of electricity markets characterised by an oligopoly.
