Research on the Development of Electricity Market Based on Performance Guarantee

China’s electricity market is currently in the development stage, and the related system is not comprehensive enough. Therefore, it is a key issue to standardize the trading behavior of the market entities and improve the operation efficiency of the electricity market. To solve this problem, this paper takes advantage of Cournot duopoly model to find Nash equilibrium on the electricity supply side and constructs a bank performance guarantee model based on the profit function on the electricity sales side. This study also sorts out the function of performance guarantee, its mechanism for risk prevention, and the feasibility of promoting the performance guarantee mechanism and other supporting systems. Finally, the conclusion is drawn that the performance guarantee mechanism can effectively prevent the risks in the electricity market, and it can be promoted with other supporting systems.