Resources Radio Designing the Electricity Markets of the Future, with Chiara Lo Prete
Jul 15, 2024
In this engaging discussion, Chiara Lo Prete, an associate professor of energy economics at Penn State University, dives into the intricacies of electricity markets across the U.S. She highlights the diversity of these markets and the critical need for resource adequacy, particularly during extreme weather events. Lo Prete also explores the transition from fossil fuels to renewables, addressing challenges like intermittency and innovative solutions for future market designs. Her insights offer a compelling look at balancing demand and sustainable energy integration.
AI Snips
Chapters
Transcript
Episode notes
Resource Adequacy in the US
- US resource adequacy is addressed via regulated monopolies, decentralized procurement, capacity markets, and scarcity pricing.
- Texas uses scarcity pricing but also has a controversial bill for new natural gas plants.
Why Electricity Markets Need Long-Term Resource Adequacy
- Electricity markets need long-term resource adequacy mechanisms due to price caps and offer caps.
- These are meant to prevent market power abuse but can lead to reliability issues.
Challenges of Decarbonization
- The shift from coal to gas makes grids reliant on gas, which can be unreliable in winter.
- The move to renewables creates reliability challenges beyond peak hours, focusing on "net demand".