Clean Capacity Auction
A clean capacity auction procures firm capacity from low- or zero-carbon resources, ensuring resource adequacy while meeting emissions targets. Auctions may include renewables paired with storage, demand response, carbon capture-equipped plants, or qualified imports. Clearing prices reflect both reliability value and carbon constraints.
Designs often include technology-neutral eligibility with emissions intensity caps, hybrid accreditation rules, and long-term contracts that provide financing certainty for new clean capacity. Penalty structures enforce delivery during scarcity events.
Clean capacity auctions complement traditional capacity markets by prioritizing decarbonized resources and signaling when fossil plants must retire or retrofit. Policymakers use auctions to align reliability planning with climate mandates.
Developers targeting these auctions model ELCC, hybrid dispatch, and storage augmentation strategies to maximize qualified capacity submissions.
Technical Details
- •Procures dependable capacity from resources meeting emissions thresholds
- •Incorporates ELCC or hybrid accreditation methodologies
- •Contracts may span 7-15 years to support financing
- •Includes performance penalties tied to scarcity events
- •Can be run as descending clock, sealed bid, or pay-as-clear auctions
Why It Matters
Clean capacity auctions create bankable demand for low-carbon firm resources. Tera tracks auction parameters, clearing prices, and winning sponsors so stakeholders can align development strategies with reliability needs.
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