Ensuring Generation Adequacy in Competitive Electricity Markets

摘要: This paper discusses alternative approaches that have been adopted around the world for guaranteeing appropriate level of investment in electric generation capacity. We argue long term reserves should be viewed as price insurance and treated a private good. However, political realities asymmetries distortions risk management incentives may necessitate imposition mandatory levels such on load serving entities. Furthermore, centralized markets needed supplement to bilateral contracting order facilitate efficient procurement bridge gap between needs generators entities with regard duration hedging instruments. discuss origins shortcomings capacity payments obligations explain how supply contracts form call options premiums depend contracts' strike prices can meet need ensuring adequacy financial health generator sector. also outline scheme where regulatory intervention assurance takes requirement imposed at state