Fokussierte Kapazitätsmärkte - LBD-Beratungsgesellschaft mbH

Fokussierte Kapazitätsmärkte Öko-Institut / LBD / RAUE LLP
ply system; the building of new, very flexible and low emission power plants which
complement the fluctuating electricity production from wind and solar energy is essential
for technical and economic reasons.
In view of these criteria and the problems of the capacity market models put forward to
date (strategic reserve, a comprehensive capacity market), the concept of the “focused
capacity market” is being developed. This design option for a capacity market consists
of two different segments, for which separate auctions are carried out and in which
different power plants as well as measures for flexibilising electricity demand and storage
can participate. In the “incumbent power plants” market segment, power plants at
risk of decommissioning compete with dispatchable load (demand response) for capacity
payments for one or four years. In the “new power plants” market segment, power
plants which fulfil high flexibility demands and environmental requirements and new
electricity storage compete for capacity payments over 15 years. The capacity payments
of different duration increase planning security for investors and plant operators
while decreasing risk premiums and thus the costs for electricity consumers.
The distinction between the two segments makes it possible to tailor capacity payments
to useful time periods, enables the productive incorporation of controllable loads
and storage, and extensively avoids free-rider effects. The rigorously competitive setup
of the tendering procedure generates high competition pressure and ensures low
prices. The possibility that the successful bidders in the capacity auctions are regular
participants in the electricity and energy market maintains the competition intensity in
the power market, at least partly avoids erratic scarcity prices and the corresponding
burden for the customers, and facilitates the expansion of a highly flexible power plant
segment, which is urgently needed in the future to complement the fluctuating renewable
production from wind and solar energy. In addition there is the possibility of integrating
regional aspects, in particular investments in new power plants, and thereby
also contributing to easing the burden on the network.
The costs which are substantially curbed for the reasons mentioned are refinanced via
the network use charges on the transmission network level.
By definition the system ensures a high level of security of supply. By implementing the
system with call options, with which the tenderer can partially skim off the revenues of
the successful bidders in the case of very high electricity prices, the power plants enjoying
receipt of capacity payments are prevented from exercising market power and
the costs are reduced for electricity consumers.
For the technical implementation of the focused capacity market a range of procedures
(registration of the plants, identification of quantitative targets in a consultation procedure,
auctioning, monitoring compliance, etc.) are necessary. However, these implementation
measures also apply to a similar extent in the case of all other options and
remain within limits. Focusing the capacity market on the two segments of “incumbent
power plants” and “new power plants” also enables easy adaptation and implementation
as a learning system.
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