Two new papers prepared for Advanced Energy Economy by The Brattle Group highlight the importance of energy efficiency participation as a supply-side resource in capacity markets generally, and offer recommendations to make best use of energy efficiency for resource adequacy in the MISO market specifically.
The Benefits of Energy Efficiency Participation in Capacity Markets explains the importance of allowing energy efficiency to participate in capacity markets as a supply-side resource. The paper explores the impact of supply-side versus demand-side accounting, and identifies a few key reasons why supply-side participation leads to more efficient outcomes.
Enabling Cost-Effective Energy Efficiency in the Midcontinent ISO Resource Adequacy Construct focuses on maximizing the benefits of energy efficiency in the MISO market, where the resource adequacy construct is being reviewed and updated in light of a changing resource mix and system needs. The Brattle Group recommends continuing to allow energy efficiency to participate in the market as a supply- side capacity resource, and recommends continuing to rely on gross accounting rather than making a switch to net accounting for wholesale capacity markets, where what matters is real and verified energy efficiency contributions to resource adequacy—exactly what gross accounting measures.