1 / 4

Resource Adequacy, Hedging and Energy only markets

Resource Adequacy, Hedging and Energy only markets. James Bushnell University of California Energy Institute. Can’t we all get along? the common ground. The best way to get performance ( i.e. energy) out of capacity is through potentially high energy prices or mechanisms that act like them

vesna
Download Presentation

Resource Adequacy, Hedging and Energy only markets

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Resource Adequacy, Hedgingand Energy only markets James Bushnell University of California Energy Institute

  2. Can’t we all get along?the common ground • The best way to get performance (i.e. energy) out of capacity is through potentially high energy prices • or mechanisms that act like them • Electricity markets need energy cost hedging • buyers to mitigate risk and market power • suppliers to mitigate risk and raise financing • There are reasons to mandate such hedging • regulation and market design issues can dilute incentive to hedge energy costs • The current California system does not accomplish this • neither does the New England settlement? • Everybody loves Harry Singh

  3. Lots left to argue about • Must contracts be certified as physical capacity, or is the financial penalty for non-performance enough? • the curious case of imports • local capacity issues • How long should contracts be? Should new capacity be treated differently? Is that fair? • Why use a multiplier? Is this just a politically correct way to raise the price cap? • If entry is difficult, will there still be market power in the capacity market?

  4. Other Comments • “it is better to use a clean well-tested stop gap measure than to implement a half-baked temporary RA program” • The demand side flaws identified in CS will be largely eliminated by 2010, if not now. • actually many meters in place now • Can always identify who is short at the LSE level • Contract requirements do provide missing money as the mandate trumps the price cap

More Related