Energy policy aims to deliver security, sustainability and affordability, but politicians treat security of supply as over-riding. Absent market and regulatory failures, liberalized energy-only electricity markets might deliver adequate capacity. Ambitious targets for subsidized renewables and policy uncertainty have undermined the commercial case for the investment needed to handle increased intermittency and raised concerns for capacity adequacy. In response Britain now holds annual capacity auctions. The paper examines the case for, criticisms of, and the outcome of the first auction, criticizing the decision to ignore the contribution that interconnectors make to security of supply.
Étiqueté : interconnectors
The European Commission’s Target Electricity Model aims to integrate EU electricity markets. This EPRG paper estimates the potential benefit to the EU of coupling interconnectors to increase the efficiency of trading day-ahead, intra-day and sharing balancing services efficiently across borders
The UK Government has developed a carefully designed Capacity Mechanism to ensure security of supply in the GB electricity system. This paper criticises the methods used to determine the amount of capacity to procure, and argues that the amount finally proposed is likely to be excessive, particularly (but not exclusively) in ignoring the contribution from interconnectors…