No more wholesale price caps?
- Jun 16, 2022 11:55 am GMT
Australia, California, Texas... have all set or raised price caps in their wholesale markets with horrible results.
In Texas pushing the cap to $9,000 created chaos and not much more power in Feb 2021, In Australia the current caps caused generators to decide not to bid in. In California it has lead to the demise of several peaker plants, and the rush to replace them.
Instead of a cap, markets should create a rule that investigates excessive bids, and bidders found gaming the market or grabbing windfall profits in a tight market should be fined the windfall profits.
The whole idea of a market clearing price might need to be examined and tossed too.
Both are worth investigating and debating. are fundamentals of current market designs, both may be obsolete?
As the resources in the market evolve, should not the fundamental concepts be re-examined too?
Get Published - Build a Following
The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.
If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.