A new report released integrates legal, technical, economic and institutional considerations into a set of recommended reforms that will help enable low-cost, reliable power service across the various U.S. power market structures. The report, Ensuring Low-Cost Reliability: Resource Adequacy Recommendations for a Clean Energy Grid, was prepared by Grid Strategies LLC for the American Council on Renewable Energy (ACORE), and was produced in collaboration with the American Clean Power Association and the Solar Energy Industries Association.

"As the nation's sources of electricity evolve to meet clean energy targets and decarbonize the power sector, it is important that we focus on the evolving mix of renewable resources and enabling grid technologies that best ensure an adequate power supply," said ACORE President and CEO Gregory Wetstone. "This new paper on resource adequacy demonstrates the need to reevaluate current approaches and provides road maps for improving the various market and regulatory constructs to ensure power system operators can reliably deliver the affordable, renewable electricity that Americans want and deserve." 

The U.S. Federal Energy Regulatory Commission (FERC) is currently considering fundamental questions on this topic, as recent unplanned power outages in California, Texas, and some parts of the Central U.S. have raised concerns among the general public and policymakers about both the adequacy and performance of current market structures. Resource adequacy (RA) is defined by FERC and the North American Electric Reliability Corporation as "the ability of supply-side and demand-side resources to meet the aggregate electrical demand (including losses)."

"We can decarbonize at low costs if we appropriately measure and value all resources' contributions to resource adequacy," said Rob Gramlich, Founder and President of Grid Strategies. "Assembling a full balanced portfolio to serve load at all times and places is going to take a lot of work from all parties in all regions."

The paper identifies key issues and options for achieving RA in a decarbonized U.S. power system, and evaluates several recent proposals intended to update current policies for a clean energy future. The report also outlines nine recommended reforms that apply to RA policies across all regions and regulatory structures that would support reliability, efficiency, and clean energy integration:

• Provide non-discriminatory capacity value for clean energy and all resources
• Create buyers with accountability
• Avoid FERC jurisdiction over environmental attributes
• Increase regionalization
• Increase the granularity of resource adequacy and reliability products
• Shift relative payments from capacity to the energy and ancillary services markets
• Utilize competitive procurement for new generation
• Support regional stress testing and evolving resource adequacy assessment methodologies
• Develop new metrics of system reliability

"The clean energy transition is underway and achieving a net-zero emissions grid by 2035 will require a major shift in the resource mix and a reassessment of grid operations and market design to ensure clean power is reliably delivered to consumers. This study is an important evaluation of approaches to resource adequacy that informs a set of recommendations that can help achieve a reliable decarbonized power system," said Heather Zichal, CEO of the American Clean Power Association.

"Grid operators need to be prepared for an acceleration of the clean energy economy over the next decade," said Sean Gallagher, vice president of state and regulatory affairs at the Solar Energy Industries Association (SEIA). "This report offers a new framework for assessing resource adequacy that can increase both local and system-wide reliability, recognizing that solar and storage are already some of the most predictable technologies on the grid. Following these recommendations could unlock new market opportunities for clean energy resources while improving reliability and resilience."

ACORE | www.acore.org

Grid Strategies | https://gridstrategiesllc.com