Capacity payments in imperfect electricity markets: Need and design

By P. Joskow. 2008

455 citations recorded by the source corpus.

Subfields: Economics and Econometrics, Electrical and Electronic Engineering

View Paper: https://www.semanticscholar.org/paper/001adb17f27cc157e9702c43e2fb2e387c477db3

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Citations in the corpus

A survey on electricity market design: Insights from theory and real-world implementations of capacity remuneration mechanisms (2019, background): “Nonetheless, Joskow (2008) advocates that the capacity price could be reduced by the quasi-rents earned by a hypothetical peaking unit, thereby disincentivizing the exercise of market power.”
Decreasing market value of variable renewables can be avoided by policy action (2020, background): “Both the generally lower prices and the cannibalisation effect have been perceived as problematic, because they lead to lower market revenues and would lead to less incentive to invest in new capacity in a free market [3, 9].”
Capacity Market Fundamentals (2013, background): “For instance, when capacity gets scarce there is also an increased probability of a network collapse (e.g., Joskow and Tirole 2007 and Joskow 2008).”
Electricity Scarcity Pricing Through Operating Reserves (2013, background): “Short-term changes in fuel availability, plant outages, demand conditions, load management practices and so on, would be reflected in current prices; emergency actions would be compatible with rather than in conflict with market incentives.”
Intermittent and stochastic character of renewable energy sources: Consequences, cost of intermittence and benefit of forecasting (2018, background): “These aspects require an appropriate treatment of the electricity in economic analyses 208 [37] and particularly for intermittent electricity production [38].”
Comparing the Costs of Intermittent and Dispatchable Electricity Generating Technologies (2011, background): “The difference between the high and the low hourly prices over the course of a typical year, including capacity payments for generating capacity available to supply power during critical peak hours, can be up to four orders of magnitude (Joskow 2008).”
UK Electricity Market Reform and the Energy Transition:Emerging Lessons (2018, background): “Symposium on ‘Capacity Markets’ (Joskow, 2103), particularly Cramton, Ockenfels and Stoft (2013), and earlier papers by Joskow (2008), and Joskow and Tirole (2007). 9 The US system had a long-term stable plan and allowed banking of permits to encourage investments, with considerable success (Schmale”
The U.S. Electricity Industry After 20 Years of Restructuring (2015, background): “Borenstein (2015) estimate that the accelerated depreciation amounts to an 40See Joskow (2008) for a broad overview of the role of capacity payments.”
Flexibility in Europe's power sector - an additional requirement or an automatic complement? (2013, background): “The provision of back-up capacity has been intensely discussed in the literature in recent years (for instance Cramton and Stoft (2008) and Joskow (2008)).”
Challenges for wholesale electricity markets with intermittent renewable generation at scale: the US experience (2019, background): “While there may be few hours when capacity constraints are binding, energy prices would likely go to very high levels as demand is price-rationed and yield substantial revenue for all generators which would allow them to recover their capital costs in long-run equilibrium (Joskow, 2008).”
Market design for a high-renewables European electricity system (2018, background): “However, they in turn lead to the problem of “missing money” (Joskow, 2008): prices do not fully reflect scarcity in tight market conditions, reducing profitability and capacity investment over the longer haul.”