Date: 2014
Type: Working Paper
Capacity remuneration mechanisms in the European market : now but how?
Working Paper, EUI RSCAS, 2014/84, Florence School of Regulation, Energy, Electricity
HENRIOT, Arthur, GLACHANT, Jean-Michel, Capacity remuneration mechanisms in the European market : now but how?, EUI RSCAS, 2014/84, Florence School of Regulation, Energy, Electricity - https://hdl.handle.net/1814/32456
Retrieved from Cadmus, EUI Research Repository
This article addresses the functioning of capacity remuneration mechanisms (CRMs) in an integrated European electricity market featuring a high share of intermittent renewable energy sources. We first highlight the close ties between flexibility provision and generation adequacy, and explain why these two issues must be considered concomitantly when developing CRMs. We then show that while Member States have different needs, addressing security of supply in a purely national way will be expensive. We finally identify three prerequisites for a workable Europeanization of national generation adequacy mechanisms: a consistent assessment of adequacy needs and cross-border resources, a dedicated method to allocate risks and remuneration of cross-border resources contribution, and a definition of rights over the system resources at times of extreme scarcity.
Cadmus permanent link: https://hdl.handle.net/1814/32456
ISSN: 1028-3625
Series/Number: EUI RSCAS; 2014/84; Florence School of Regulation; Energy; Electricity
Keyword(s): Capacity remuneration mechanisms Security of supply Flexibility Integrated energy market
Published version: http://hdl.handle.net/1814/32735