{"id":1454,"date":"2022-12-03T09:23:05","date_gmt":"2022-12-03T08:23:05","guid":{"rendered":"https:\/\/ceem-dauphine.eu\/the-long-term-central-buyer-model-a-solution-to-strengthen-low-carbon-transition-and-to-protect-consumers-while-keeping-efficient-spot-markets\/"},"modified":"2022-12-03T09:23:05","modified_gmt":"2022-12-03T08:23:05","slug":"the-long-term-central-buyer-model-a-solution-to-strengthen-low-carbon-transition-and-to-protect-consumers-while-keeping-efficient-spot-markets","status":"publish","type":"post","link":"https:\/\/ceem-dauphine.eu\/en\/the-long-term-central-buyer-model-a-solution-to-strengthen-low-carbon-transition-and-to-protect-consumers-while-keeping-efficient-spot-markets\/","title":{"rendered":"The long term central buyer model a solution to strengthen low carbon transition and to protect consumers while keeping efficient spot markets"},"content":{"rendered":"<p>This paper proposes an alternative to the current market design based on hourly prices<br \/>\naligned with marginal costs and on which retail prices are built. It is based on a public<br \/>\nentity which is the counterpart in long term financial contracts (contracts for differences or<br \/>\nCfDs) signed up with to share risks in new and existing assets of low carbon technologies<br \/>\n(renewables [RES], nuclear), in parallel with the development of private long term contracts<br \/>\n(PPA) between private agents . Besides this function of central contractor, the public entity is<br \/>\nalso a central purchasing agency: it buys their corresponding energy production on the spot<br \/>\nmarket.<br \/>\nSo the central buyer is in a position to sell wholesale electricity from low carbon generators<br \/>\nto competing suppliers at prices mainly based on long-term costs (represented by CfD\u2019s strike<br \/>\nprices). CfDs have the virtue to erase the rents of infra-marginal producers (namely RES and<br \/>\nnuclear) in periods of fossil price spike. Suppliers will pass long term costs through retail<br \/>\nprices they offer to each type of customers along their load profiles. This new organizational<br \/>\nmodel of electricity market not only meets the need to rapidly invest in capital-intensive<br \/>\ntechnologies for low-carbon transition to net-zero, but also consumers\u2019 need for protection<br \/>\nagainst price risks and excessive dependence on highly volatile gas market.<br \/>\nA variant is presented in appendix, in which the agency is only a central contractor with low<br \/>\ncarbon generators and does not directly cover the price risk for the suppliers. It might be<br \/>\nmore conducive to compromise.<\/p>\n","protected":false},"excerpt":{"rendered":"This paper proposes an alternative to the current market design based on hourly prices aligned with marginal [&hellip;]","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[13,24],"tags":[],"class_list":["post-1454","post","type-post","status-publish","format-standard","hentry","category-publications-en","category-policy-papers-en"],"acf":[],"_links":{"self":[{"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/posts\/1454","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/comments?post=1454"}],"version-history":[{"count":0,"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/posts\/1454\/revisions"}],"wp:attachment":[{"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/media?parent=1454"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/categories?post=1454"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/en\/wp-json\/wp\/v2\/tags?post=1454"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}