Resource Adequacy: Should Regulators Worry?

Hernan Bejarano, Clifner Lance, Johnston Carl, Stephen Rassenti and Vernon Smith ()
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Clifner Lance: August Systems Inc.
Johnston Carl: George Mason University

Review of Network Economics, 2012, vol. 11, issue 4, 35

Abstract: Regulators have proposed various institutional alternatives to secure network resource adequacy and reasonably priced electric power for consumers. These alternatives prompt many difficult questions: Does the development of Demand Response reduce the need for new capacity? How effectively can a government-mandated Capacity Market foster efficient investment? How does centralized generator commitment (with revenue guarantees) compare to a system in which Generators voluntarily commit themselves with no revenue guarantees? If exclusive distribution contracts were replaced by unregulated retail competition, what would be the effects on investment and market prices? We use laboratory experiments to address these questions.

Keywords: electric power networks; resource adequacy; capacity markets; demand response; retail competition; central commitment (search for similar items in EconPapers)
Date: 2012
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DOI: 10.1515/1446-9022.1391

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