Renewable Energy Systems

2013 Edition
| Editors: Martin Kaltschmitt, Nickolas J. Themelis, Lucien Y. Bronicki, Lennart Söder, Luis A. Vega

Wind Power: Economy, Market, Subsidies, Payment Mechanisms, and Capacity Credit

  • Michael Milligan
  • Lori Bird
  • Suzanne Tegen
  • Kevin Porter
  • Sari Fink
  • Brendan Kirby
Reference work entry
DOI: https://doi.org/10.1007/978-1-4614-5820-3_89

Definition of Subject

With increasing concern regarding climate change and emissions from conventional power plants, new markets have developed that allow for the trading of the clean energy attributes of wind and other renewable energy sources. We discuss these green power markets and their role in demonstrating compliance with renewable energy standards. Wind energy can also be bought and sold in wholesale energy markets, exchanges where bulk energy is bought and sold. In some areas, capacity markets exist that provide payment for installed capacity that is available when needed. Capacity markets are generally based on the capacity contribution that a power plant or responsive load can make toward planning reserves, which is called the capacity credit or capacity value. The general motivation behind a capacity market is to ensure sufficient revenue for the generator and sufficient installed capacity.

In some countries, government incentives exist that encourage the development and...
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Bibliography

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Copyright information

© Springer Science+Business Media New York 2013

Authors and Affiliations

  • Michael Milligan
    • 1
  • Lori Bird
    • 1
  • Suzanne Tegen
    • 1
  • Kevin Porter
    • 2
  • Sari Fink
    • 2
  • Brendan Kirby
    • 1
  1. 1.National Renewable Energy LaboratoryGoldenUSA
  2. 2.Exeter AssociatesColumbiaUSA