DocumentCode :
1182515
Title :
A Market Approach to Long-Term Security of Supply
Author :
Vazquez, Carlos ; Rivier, M. ; Perez-Arriaga, I. J.
Author_Institution :
Universidad Pontificia Comillas, Madrid, Spain
Volume :
22
Issue :
3
fYear :
2002
fDate :
3/1/2002 12:00:00 AM
Firstpage :
58
Lastpage :
58
Abstract :
The problem of ensuring that there is enough generation capacity to meet future demand has been an issue in market design since the beginning of the deregulation process. Although ideally the market itself should be enough to provide adequate investment incentives, there are several factors that prevent this result from being achieved, and some actual markets have already experienced problems related with a lack of generation capacity. A regulatory framework to address this question is presented. The procedure is based on an organized market where reliability contracts (based on financial call options) are auctioned, so both their price and their allocation among the different plants are determined through competitive mechanisms. This results in a stabilization of the income of the generators and provides a clear incentive for new generation investment, with a minimum of regulatory intervention. Additionally, the method represents a market-compatible mechanism to hedge demand from the occurrence of high market prices.
Keywords :
Circuit breakers; Contracts; Electricity supply industry; Investments; Observability; Power generation; Power system analysis computing; Power system modeling; Security; Switching circuits; Capacity markets; capacity payments; electricity markets; generation adequacy; long-term guarantee of supply; wholesale market design;
fLanguage :
English
Journal_Title :
Power Engineering Review, IEEE
Publisher :
ieee
ISSN :
0272-1724
Type :
jour
DOI :
10.1109/MPER.2002.4312066
Filename :
4312066
Link To Document :
بازگشت