Resource adequacy in decarbonizing power systems: Lessons learned from both sides of the Atlantic

C. Batlle, P. Mastropietro, P. Rodilla, I.J. Pérez-Arriaga

In the book Capacity mechanisms in the EU energy market: Law, policy, and economics

Oxford University Press, Oxford, United Kingdom

Summary

Resource adequacy mechanisms are becoming a pillar of power sector regulation during the energy transition. In this chapter, we identify, review, and discuss the key design elements of resource adequacy mechanisms, extracting guidelines from international experiences on both sides of the Atlantic. Among the topics analysed in this chapter, there are the identification of the buying and the selling sides in the market, the level of centralization, the definition of the reliability product, the identification of scarcity conditions, the design of de-rating methodologies, the lag period and duration of capacity contracts, and performance incentives. Based on this analysis, the chapter provides guidelines for all the countries where similar mechanisms are currently under discussion and presents high-level recommendations.

Spanish layman's summary:

Este capítulo analiza los principales elementos de diseño de los mecanismos de capacidad, superando las taxonomías clásicas. Para cada elemento de diseño, el capítulo presenta una revisión de las experiencias internacionales recientes de Europa, Estados Unidos y América Latina.

 

 

English layman's summary:

This chapter analyses the main design elements of resource adequacy mechanisms, moving beyond classical taxonomies used so far. For each design element, the chapter presents a review of recent international experiences from Europe, the United States, and Latin America.

Keywords: Resource adequacy, reliability product, scarcity conditions, firm supply, de-rating, performance incentives, contract duration, lag period, demand resources, demand response

Editors: Hancher, L.; et al.,

ISBN: 978-0-19-284980-9

DOI: https://doi.org/10.1093/oso/9780192849809.003.0007

DOI of the book: https://doi.org/10.1093/oso/9780192849809.001.0001

Published: 2022

Citation:
C. Batlle, P. Mastropietro, P. Rodilla, I.J. Pérez-Arriaga, Resource adequacy in decarbonizing power systems: Lessons learned from both sides of the Atlantic, in Capacity mechanisms in the EU energy market: Law, policy, and economics. Editors Hancher, L.; et al., . Ed. Oxford University Press. Oxford, United Kingdom, 2022.

IIT-22-301L