{"id":1319,"date":"2017-10-05T09:43:33","date_gmt":"2017-10-05T07:43:33","guid":{"rendered":"https:\/\/ceem-dauphine.eu\/capacity-adequacy-in-power-markets-facing-energy-transition-a-comparison-of-scarcity-pricing-and-capacity-mechanism\/"},"modified":"2017-10-05T09:43:33","modified_gmt":"2017-10-05T07:43:33","slug":"capacity-adequacy-in-power-markets-facing-energy-transition-a-comparison-of-scarcity-pricing-and-capacity-mechanism","status":"publish","type":"post","link":"https:\/\/ceem-dauphine.eu\/fr\/capacity-adequacy-in-power-markets-facing-energy-transition-a-comparison-of-scarcity-pricing-and-capacity-mechanism\/","title":{"rendered":"Capacity adequacy in power markets facing energy transition: A comparison of scarcity pricing and capacity mechanism"},"content":{"rendered":"<p>This article analyses how a capacity mechanism can address security of supply objectives in a power market<br \/>\nundergoing an energy transition that combines energy efficiency efforts to stabilise demand and a rapid increase<br \/>\nin the proportion of renewables. To analyse this situation, power markets are simulated over the long term with<br \/>\na System Dynamics model integrating new investment and closure decisions. This last trait is relevant to<br \/>\nstudying investment in power generation in mature markets undergoing policy shocks. The energy-only market<br \/>\ndesign with a price cap, with and without a capacity mechanism, is compared to scarcity pricing in two<br \/>\ninvestment behaviour scenarios with and without risk aversion. The results show that the three market designs<br \/>\nlead to different levels of risk for peaking unit investment and results thus differ according to which risk<br \/>\naversion hypothesis is adopted. Assuming a risk-neutral investor, the results indicate that compared to an<br \/>\nenergy-only market with a price cap at 3 000 \u20ac\/MWh, an energy-only market with scarcity pricing and the<br \/>\nmarket design with a capacity mechanism are two efficient options to reach similar levels of load loss. But under<br \/>\nthe hypothesis of risk aversion, the results highlight the advantage of the capacity mechanism over scarcity<br \/>\npricing.<\/p>\n<p>Energy Policy 103 (2017)<\/p>\n","protected":false},"excerpt":{"rendered":"This article analyses how a capacity mechanism can address security of supply objectives in a power market [&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":[11,15],"tags":[],"class_list":["post-1319","post","type-post","status-publish","format-standard","hentry","category-publications","category-articles"],"acf":[],"_links":{"self":[{"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/posts\/1319","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/comments?post=1319"}],"version-history":[{"count":0,"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/posts\/1319\/revisions"}],"wp:attachment":[{"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/media?parent=1319"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/categories?post=1319"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ceem-dauphine.eu\/fr\/wp-json\/wp\/v2\/tags?post=1319"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}