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Title: Long-Term Resource Adequacy, Long-Term Flexibility Requirements, and Revenue Sufficiency

Abstract

Variable generation (VG) can reduce market prices over time and also the energy that other suppliers can sell in the market. The suppliers that are needed to provide capacity and flexibility to meet the long-term reliability requirements may, therefore, earn less revenue. This chapter discusses the topics of resource adequacy and revenue sufficiency - that is, determining and acquiring the quantity of capacity that will be needed at some future date and ensuring that those suppliers that offer the capacity receive sufficient revenue to recover their costs. The focus is on the investment time horizon and the installation of sufficient generation capability. First, the chapter discusses resource adequacy, including newer methods of determining adequacy metrics. The chapter then focuses on revenue sufficiency and how suppliers have sufficient opportunity to recover their total costs. The chapter closes with a description of the mechanisms traditionally adopted by electricity markets to mitigate the issues of resource adequacy and revenue sufficiency and discusses the most recent market design changes to address these issues.

Authors:
 [1];  [1];  [1];  [2];  [3];  [3]
  1. National Renewable Energy Laboratory (NREL), Golden, CO (United States)
  2. Electric Power Research Institute
  3. Argonne National Laboratory
Publication Date:
Research Org.:
National Renewable Energy Lab. (NREL), Golden, CO (United States)
Sponsoring Org.:
USDOE Office of Energy Efficiency and Renewable Energy (EERE)
OSTI Identifier:
1425727
Report Number(s):
NREL/CH-5D00-71088
DOE Contract Number:
AC36-08GO28308
Resource Type:
Book
Country of Publication:
United States
Language:
English
Subject:
24 POWER TRANSMISSION AND DISTRIBUTION; variable generation; resource adequacy; revenue sufficiency; capacity

Citation Formats

Milligan, Michael, Bloom, Aaron P, Townsend, Aaron, Ela, Erik, Botterud, Audun, and Levin, Todd. Long-Term Resource Adequacy, Long-Term Flexibility Requirements, and Revenue Sufficiency. United States: N. p., 2018. Web. doi:10.1007/978-3-319-74263-2_6.
Milligan, Michael, Bloom, Aaron P, Townsend, Aaron, Ela, Erik, Botterud, Audun, & Levin, Todd. Long-Term Resource Adequacy, Long-Term Flexibility Requirements, and Revenue Sufficiency. United States. doi:10.1007/978-3-319-74263-2_6.
Milligan, Michael, Bloom, Aaron P, Townsend, Aaron, Ela, Erik, Botterud, Audun, and Levin, Todd. Thu . "Long-Term Resource Adequacy, Long-Term Flexibility Requirements, and Revenue Sufficiency". United States. doi:10.1007/978-3-319-74263-2_6.
@article{osti_1425727,
title = {Long-Term Resource Adequacy, Long-Term Flexibility Requirements, and Revenue Sufficiency},
author = {Milligan, Michael and Bloom, Aaron P and Townsend, Aaron and Ela, Erik and Botterud, Audun and Levin, Todd},
abstractNote = {Variable generation (VG) can reduce market prices over time and also the energy that other suppliers can sell in the market. The suppliers that are needed to provide capacity and flexibility to meet the long-term reliability requirements may, therefore, earn less revenue. This chapter discusses the topics of resource adequacy and revenue sufficiency - that is, determining and acquiring the quantity of capacity that will be needed at some future date and ensuring that those suppliers that offer the capacity receive sufficient revenue to recover their costs. The focus is on the investment time horizon and the installation of sufficient generation capability. First, the chapter discusses resource adequacy, including newer methods of determining adequacy metrics. The chapter then focuses on revenue sufficiency and how suppliers have sufficient opportunity to recover their total costs. The chapter closes with a description of the mechanisms traditionally adopted by electricity markets to mitigate the issues of resource adequacy and revenue sufficiency and discusses the most recent market design changes to address these issues.},
doi = {10.1007/978-3-319-74263-2_6},
journal = {},
number = ,
volume = ,
place = {United States},
year = {Thu Feb 15 00:00:00 EST 2018},
month = {Thu Feb 15 00:00:00 EST 2018}
}

Book:
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