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dc.contributor.authorHach, D.en
dc.contributor.authorChi Chyong, K.en
dc.contributor.authorSpinler, S.en
dc.date.accessioned2016-04-22T15:02:07Z
dc.date.available2016-04-22T15:02:07Z
dc.date.issued2015-04-20en
dc.identifier.otherCWPE1508
dc.identifier.urihttps://www.repository.cam.ac.uk/handle/1810/255361
dc.description.abstractRising feed-in from renewable energy sources decreases margins, load factors, and thereby profitability of conventional generation in several electricity markets around the world. At the same time, conventional generation is still needed to ensure security of electricity supply. Therefore, capacity markets are currently being widely discussed as a measure to ensure generation adequacy in markets such as France, Germany, and the United States (e.g., Texas), or even implemented for example in Great Britain. We assess the effect of different capacity market design options in three scenarios: 1) no capacity market, 2) a capacity market for new capacity only, and 3) a capacity market for new and existing capacity. We compare the results along the three key dimensions of electricity policy ��� affordability, reliability, and sustainability. In a Great Britain case study we find that a capacity market increases generation adequacy since it provides incentives for new generation investments. Furthermore, our results show that a capacity market can lower the total bill of generation because it can reduce lost load and the potential to exercise market power. Additionally, we find that a capacity market for new capacity only is cheaper than a capacity market for new and existing capacity because it remunerates fewer generators in the first years after its introduction.en
dc.description.abstractrenewable energy sourcesen
dc.publisherFaculty of Economics
dc.relation.ispartofseriesCambridge Working Papers in Economics
dc.rightsAll Rights Reserveden
dc.rights.urihttps://www.rioxx.net/licenses/all-rights-reserved/en
dc.subjectCapacity mechanismen
dc.subjectcapacity marketen
dc.subjectdynamic capacity investment modelen
dc.subjectgeneration adequacyen
dc.subjectconventional electricity generation investmenten
dc.titleCapacity market design options: a dynamic capacity investment model and a GB case studyen
dc.typeWorking Paperen
dc.identifier.doi10.17863/CAM.5818


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