I'm still making my way through this report. The report contains several statistical observations that I want to dig deeper into. These excerpts are particularly noteworthy:
The market must accurately reflect and properly incentivize the flexibility needs of the system. The current Reserve Market construct utilizes a two-step ORDC, and while it accurately reflects the risk posed by a single contingency, it fails to capture the rise in uncertainty driven by the penetration of renewable resources. The simulation results underscored the deficiencies in the current construct, indicating that the two-step ORDC procures less than a third of the reserves needed by the system and, with an average clearing price of $0.02/MWh, it also fails to send long-term market signals to incentivize flexibility.
"There is an opportunity for PJM and stakeholders to explore the participation of renewable resources in the reserves market"