Wind Solar Alliance releases report examining market rules, renewables
The Wind Solar Alliance (WSA) released a report Monday, titled Customer-Focused and Clean: Power Markets for the Future, which highlights how market rules affect renewable energy and offers recommendations for updating these rules.
“The report demonstrates the numerous ways that existing market structures, particularly in PJM and MISO, are biased in favor of older, large, slow-to-react resources,” WSA Executive Director John Kostyack said. “Although wind and solar power are beating all other sources on cost in many regions, grid operators limit their deployment by failing to utilize them for reliability services such as ramping and frequency regulation. It’s time for market operators to ensure these clean, low-cost technologies are appropriately recognized and rewarded for the reliability services they can provide.”
The report notes that many regional transmission organization (RTO) rules were written before renewables made up a substantial portion of the generation fleet and that some characteristics mentioned in these rules reflect characteristics of certain generators rather than reliability services. Renewables, WSA said, can provide services such as frequency stabilization and regulation, ramping and voltage regulation.
“This report identifies ways to modernize electricity markets so all technologies can compete to provide the reliability services that keep the lights on and the costs low – that’s a win for innovative resources like wind energy and for consumers,” Amy Farrell, senior vice president of government and public affairs at the American Wind Energy Association (AWEA), said.
Grid Strategies produced the report for WSA. The Grid Strategies team included Rob Gramlich, Grid Strategies founder and president; Michael Goggin, vice president at Grid Strategies; Steven Shparber, former counsel for PJM; and Alison Silverstein, the lead author of the recent US Department of Energy Staff Report on Electricity Markets and Reliability. In producing the report, the authors completed a literature review and a survey of experts.
“Power markets benefit customers most when all resources are allowed in,” Gramlich said. “The key to operating reliably and efficiently through the resource shift taking place is to make sure market design appropriately compensates flexibility and eliminates undue compensation for inflexible resources.”
