Revenue adequacy, shortfall allocation and transmission performance incentives in FTR/FGR markets

Shmuel S. Oren, Kory W. Hedman

Research output: Chapter in Book/Report/Conference proceedingConference contribution

6 Scopus citations

Abstract

We examine the issue of revenue adequacy in Financial Transmission Rights (FTR) Markets and address two questions: a) How should revenue shortfalls in FTR markets be assigned to market participants? and b) How can active participation by transmission owners in FTR markets incentivize transmission performance through incremental and long term investment? In particular we focus on the possibility of short positions by transmission owners on financial Flowgate Rights (FGRs). Such positions would allow their holders to capture some of the FTR auction revenues in exchange for assuming liability for the corresponding FTR market revenue shortfall, which can be avoided through improvements in line ratings.

Original languageEnglish (US)
Title of host publication2010 IREP Symposium - Bulk Power System Dynamics and Control - VIII, IREP2010
DOIs
StatePublished - Oct 25 2010
Externally publishedYes
Event2010 IREP Symposium - Bulk Power System Dynamics and Control - VIII, IREP2010 - Rio de Janeiro, Brazil
Duration: Aug 1 2010Aug 6 2010

Publication series

Name2010 IREP Symposium - Bulk Power System Dynamics and Control - VIII, IREP2010

Other

Other2010 IREP Symposium - Bulk Power System Dynamics and Control - VIII, IREP2010
CountryBrazil
CityRio de Janeiro
Period8/1/108/6/10

Keywords

  • Financial Transmission Rights (FTR)
  • Flowgate Right (FGR)
  • Performance incentives
  • Revenue adequacy
  • Transmission investment

ASJC Scopus subject areas

  • Energy Engineering and Power Technology
  • Control and Systems Engineering

Cite this

Oren, S. S., & Hedman, K. W. (2010). Revenue adequacy, shortfall allocation and transmission performance incentives in FTR/FGR markets. In 2010 IREP Symposium - Bulk Power System Dynamics and Control - VIII, IREP2010 [5563297] (2010 IREP Symposium - Bulk Power System Dynamics and Control - VIII, IREP2010). https://doi.org/10.1109/IREP.2010.5563297