Resource Adequacy and the Cost of Reliability
Download the white paper: Series of Regulatory Choices No. 5, "Resource Adequacy and the Cost of Reliability" (email registration required).
Properly functioning electric markets create incentives for the construction of new generating units and transmission lines. Different regions in North America have established different market rules and varying criteria for infrastructure investments. As new technologies are developed, and as customers are better integrated into the electric system, there is a need to compare and contrast the rules and investment criteria in these regions to determine whether one region can learn from another.
Resource Adequacy Working Group
All stakeholders would benefit from practical reforms that can be adopted now and accomplished within a few years to improve resource adequacy and lower the cost of reliability in the major electricity markets in North America. Everyone will benefit from greater diversity in the resource mix, greater resiliency in the infrastructure, a level of volatility that can be appropriately hedged, and greater certainty with respect to government decisions and actions.
DEFG is launching a Resource Adequacy Working Group to assess the current state of resource adequacy and to examine innovative approaches to lower the cost of reliability. We will develop and discuss scenarios and possible outcomes in the future with a focus on complementing the traditional approach to resource adequacy with demand-side resources. The working group will prepare recommendations that will encourage: (1) adequate investments in new generating units, transmission and distribution facilities, and alternative resources, (2) sufficient focus on the cost of reliability such that these costs remain reasonable, and (3) a closer link between the use of demand-side resources and grid-level resource adequacy.
To join the Resource Adequacy Working Group, contact Nat Treadway at ntreadway@defgllc.com or 713-729-6244. 2004-05 Resource Adequacy Study
DEFG led an effort seven years ago to look at issues relating to resource adequacy and the cost of reliability. Those interested in the findings -- which have relevance today -- may download the final report: January 2005 report: Resource Adequacy Final Report (no registration required).
This report was developed through working group which considered the impact of alternative policy approaches on customers and electric market participants. The report looks at capacity markets, energy-only markets and other approaches to resource adequacy and the cost of reliability.
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This page was last updated on 12/14/2011. | 
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