IDEAS home Printed from https://ideas.repec.org/a/eee/rensus/v40y2014icp375-385.html

Electricity auctions in South America: Towards convergence of system adequacy and RES-E support

Author

Listed:
  • Mastropietro, Paolo
  • Batlle, Carlos
  • Barroso, Luiz A.
  • Rodilla, Pablo

Abstract

Regulatory reforms of the electricity industry in South America have always been prompted by the need of attracting enough investment to cover the fast-paced demand growth. In order to achieve this goal, the countries in the region which in the eighties and early nineties opted for market-oriented schemes, have rebuilt in the last decade their regulatory frameworks around long-term auctioning. These new mechanisms, initially implemented to attract investment in any sort of conventional generation technology so as to ensure the system adequacy, are also being increasingly used to bring in non-conventional renewable energy resources. These schemes have been until now run in parallel, but the steep learning curve of Renewable Energy Sources for electricity (RES-E) technologies is apparently opening the door to the implementation of new tendering procedures open to all kinds of generation technologies. In this article, we review the auction mechanisms for new generation implemented in South America. We argue that although the first impression might lead to the conclusion that conventional and RES-E technologies are in some cases close and even ostensibly competing in the same auctions, the fact is that the full convergence is still far to happen, as the rules and products applied to the different technologies differ significantly.

Suggested Citation

  • Mastropietro, Paolo & Batlle, Carlos & Barroso, Luiz A. & Rodilla, Pablo, 2014. "Electricity auctions in South America: Towards convergence of system adequacy and RES-E support," Renewable and Sustainable Energy Reviews, Elsevier, vol. 40(C), pages 375-385.
    • Handle: RePEc:eee:rensus:v:40:y:2014:i:c:p:375-385
    DOI: 10.1016/j.rser.2014.07.074
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1364032114005267
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.rser.2014.07.074?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Batlle, Carlos & Barroso, Luiz A. & Pérez-Arriaga, Ignacio J., 2010. "The changing role of the State in the expansion of electricity supply in Latin America," Energy Policy, Elsevier, vol. 38(11), pages 7152-7160, November.
    2. Batlle, C. & Pérez-Arriaga, I.J. & Zambrano-Barragán, P., 2012. "Regulatory design for RES-E support mechanisms: Learning curves, market structure, and burden-sharing," Energy Policy, Elsevier, vol. 41(C), pages 212-220.
    3. Walter Vergara & Alejandro Deeb & Natsuko Toba & Peter Cramton & Irene Leino, 2010. "Wind Energy in Colombia: A Framework for Market Entry," Papers of Peter Cramton 10wec, University of Maryland, Department of Economics - Peter Cramton, revised 2010.
    4. Botero B, Sergio & Isaza C, Felipe & Valencia, Adriana, 2010. "Evaluation of methodologies for remunerating wind power's reliability in Colombia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 14(7), pages 2049-2058, September.
    5. repec:wbk:wbpubs:2493 is not listed on IDEAS
    6. Rodilla, P. & Batlle, C., 2012. "Security of electricity supply at the generation level: Problem analysis," Energy Policy, Elsevier, vol. 40(C), pages 177-185.
    7. Chade Ricosti, Juliana F. & Sauer, Ildo L., 2013. "An assessment of wind power prospects in the Brazilian hydrothermal system," Renewable and Sustainable Energy Reviews, Elsevier, vol. 19(C), pages 742-753.
    8. repec:wbk:wbpubs:2346 is not listed on IDEAS
    9. Peter Cramton & Steven Stoft, 2007. "Colombia Firm Energy Market," Papers of Peter Cramton 07cfem, University of Maryland, Department of Economics - Peter Cramton, revised 2007.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zapata, Sebastian & Castaneda, Monica & Franco, Carlos Jaime & Dyner, Isaac, 2019. "Clean and secure power supply: A system dynamics based appraisal," Energy Policy, Elsevier, vol. 131(C), pages 9-21.
    2. Cuervo, Felipe Isaza & Botero, Sergio Botero, 2016. "Wind power reliability valuation in a Hydro-Dominated power market: The Colombian case," Renewable and Sustainable Energy Reviews, Elsevier, vol. 57(C), pages 1359-1372.
    3. repec:wbk:wbpubs:2346 is not listed on IDEAS
    4. Mastropietro, Paolo & Rodilla, Pablo & Batlle, Carlos, 2019. "De-rating of wind and solar resources in capacity mechanisms: A review of international experiences," Renewable and Sustainable Energy Reviews, Elsevier, vol. 112(C), pages 253-262.
    5. Olaya, Yris & Arango-Aramburo, Santiago & Larsen, Erik R., 2016. "How capacity mechanisms drive technology choice in power generation: The case of Colombia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 56(C), pages 563-571.
    6. Keppler, Jan Horst & Quemin, Simon & Saguan, Marcelo, 2022. "Why the sustainable provision of low-carbon electricity needs hybrid markets," Energy Policy, Elsevier, vol. 171(C).
    7. Mastropietro, Paolo & Rodilla, Pablo & Rangel, Lina Escobar & Batlle, Carlos, 2020. "Reforming the colombian electricity market for an efficient integration of renewables: A proposal," Energy Policy, Elsevier, vol. 139(C).
    8. Batlle, C. & Rodilla, P., 2010. "A critical assessment of the different approaches aimed to secure electricity generation supply," Energy Policy, Elsevier, vol. 38(11), pages 7169-7179, November.
    9. Moritz Bohland & Sebastian Schwenen, 2020. "Technology Policy and Market Structure: Evidence from the Power Sector," Discussion Papers of DIW Berlin 1856, DIW Berlin, German Institute for Economic Research.
    10. Zabaloy, Maria Florencia & Viego, Valentina, 2022. "Household electricity demand in Latin America and the Caribbean: A meta-analysis of price elasticity," Utilities Policy, Elsevier, vol. 75(C).
    11. Peter Cramton & Axel Ockenfels, 2012. "Economics and Design of Capacity Markets for the Power Sector," Papers of Peter Cramton 12cocap, University of Maryland, Department of Economics - Peter Cramton, revised 2012.
    12. Gianluca Fulli & Marcelo Masera & Catalin Felix Covrig & Francesco Profumo & Ettore Bompard & Tao Huang, 2017. "The EU Electricity Security Decision-Analytic Framework: Status and Perspective Developments," Energies, MDPI, vol. 10(4), pages 1-20, March.
    13. Figueiredo, Nuno Carvalho & Silva, Patrícia Pereira da & Cerqueira, Pedro A., 2016. "It is windy in Denmark: Does market integration suffer?," Energy, Elsevier, vol. 115(P2), pages 1385-1399.
    14. Mariia Kozlova & Alena Lohrmann, 2021. "Steering Renewable Energy Investments in Favor of Energy System Reliability: A Call for a Hybrid Model," Sustainability, MDPI, vol. 13(24), pages 1-18, December.
    15. Mastropietro, Paolo & Rodilla, Pablo & Rivier, Michel & Batlle, Carlos, 2024. "Reliability options: Regulatory recommendations for the next generation of capacity remuneration mechanisms," Energy Policy, Elsevier, vol. 185(C).
    16. Cassetta, Ernesto & Monarca, Umberto & Nava, Consuelo Rubina & Meleo, Linda, 2017. "Is the answer blowin' in the wind (auctions)? An assessment of the Italian support scheme," Energy Policy, Elsevier, vol. 110(C), pages 662-674.
    17. de la Hoz, Jordi & Martín, Helena & Miret, Jaume & Castilla, Miguel & Guzman, Ramon, 2016. "Evaluating the 2014 retroactive regulatory framework applied to the grid connected PV systems in Spain," Applied Energy, Elsevier, vol. 170(C), pages 329-344.
    18. Molyneaux, Lynette & Wagner, Liam & Froome, Craig & Foster, John, 2012. "Resilience and electricity systems: A comparative analysis," Energy Policy, Elsevier, vol. 47(C), pages 188-201.
    19. Malagueta, Diego & Szklo, Alexandre & Borba, Bruno Soares Moreira Cesar & Soria, Rafael & Aragão, Raymundo & Schaeffer, Roberto & Dutra, Ricardo, 2013. "Assessing incentive policies for integrating centralized solar power generation in the Brazilian electric power system," Energy Policy, Elsevier, vol. 59(C), pages 198-212.
    20. Pablo-Romero, María del P. & Sánchez-Braza, Antonio & Salvador-Ponce, Jesús & Sánchez-Labrador, Natalia, 2017. "An overview of feed-in tariffs, premiums and tenders to promote electricity from biogas in the EU-28," Renewable and Sustainable Energy Reviews, Elsevier, vol. 73(C), pages 1366-1379.
    21. González, Javier Serrano & Lacal-Arántegui, Roberto, 2016. "A review of regulatory framework for wind energy in European Union countries: Current state and expected developments," Renewable and Sustainable Energy Reviews, Elsevier, vol. 56(C), pages 588-602.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:rensus:v:40:y:2014:i:c:p:375-385. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/600126/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.