IEEE Power & Energy Magazine - January/February 2021 - 10

In This Issue
Electricity markets were adopted in the late 1990s or early

* Are the economic principles used to design current

2000s. At that time, renewable production based on solar

markets still valid if the generation fleet becomes re-

or wind energy (weather-dependent resources) was a rarity.

newable dominated? If most of the available gener-

Today, renewable production is not only common but also

ating sources have a marginal cost close to zero, can

dominant in some jurisdictions, such as Texas and California

electricity markets function properly? Can a stable

in the United States as well as Denmark and Spain in Europe.

flow of revenues be ensured for producers?

However, the design fundamentals of most electricity markets

* Which are the most effective mechanisms to guaran-

worldwide have remained essentially unchanged. It is true that

tee investment cost recovery in a renewable-dom-

diverse instruments have been added to markets that operate

inated power system? What is the role of capacity

systems with high renewable penetration, but the core design

payments or capacity markets in ensuring cost recov-

of virtually all markets remains that of the early 2000s.

ery? Should capacity markets be adopted, or should

This issue of IEEE Power & Energy Magazine on the zero-

producers rely solely on energy markets?

marginal-cost electricity markets addresses the changes re-

* Which are the most effective financial instruments

quired in market design and market instruments to accom-

to materialize investment in renewable generation

modate an increasing share of renewable production that

in both developing and developed regions? Can

has an exceptionally low marginal cost. These changes are

long-term contracts be adopted without altering the

most important to ensure well-functioning electricity mar-

liquidity of short-term markets? How are the roles of

kets in the future. This issue is closely related to the January/
February 2019 issue on conversations on design-wholesale
electricity markets.

electricity financial markets organized?
*
What can we learn from market experiences in
hydro-dominated systems, such as those in Norway

Decarbonization, with important ramifications for the

and Brazil? Can we translate the market experiences

power sector, is a direct consequence of increasing the in-

gained in hydro-dominated systems to renewable-

tegration of weather-dependent renewable sources, such

dominated ones?

as wind or solar power. Thus, in this context, decarboniza-

* Which are the most insightful experiences world-

tion is tantamount to renewable integration on the genera-

wide of high renewable penetration in power sys-

tion side along with changes on the demand side (load flex-

tems? Which are the lessons from Europe and other

ibility, electrification, and so on). Another consideration

parts of the world, e.g., New Zealand?

is that, for the time being, electricity cannot be stored in

Under the deft leadership of seasoned Guest Editors Luiz

great quantities. This impacts the design and operation of

Barroso and Hugh Rudnick, a diverse mix of contributors to

electricity markets.

this issue, coming from industry, government, and academia,

Within the framework for renewable-dominated systems, this issue addresses several relevant questions whose

addresses these important questions and others, providing
insightful analysis, observations, and recommendations.

answers are not yet fully clear to the power community.

IEEE Power & Energy Magazine: we
each spent formative years of our careers at American Electric Power Co.
(AEP), a North American regional utility and power engineering firm whose
accompl ish ments were ser ved i n
no small measure by the prowess of
Philip Sporn, its chief engineer and
then chief executive officer, with a career that spanned the 1920s through
the 1960s. Sporn was an immigrant
who left his mark on our profession in
engineering and business in the service
of societal advancement. He was an
10

ieee power & energy magazine

Edison Medal winner and a member of the National Academy of Engineering, and he was deeply revered
by those who worked at AEP. We are
the progeny of Sporn, someone whose
professional and civic calling speaks to
the aim of this magazine for blending
technology, business, and social progress in an open conversation with our
power and energy community.
Lastly, in late September, another
immigrant to the United States, National Academy of Engineering member
and IEEE Fellow Dr. Eugene Litvinov

Antonio Conejo

died. Dr. Litvinov contributed to the
advancement of power system analysis,
electric market system development,
and the application of information
technology to many power engineering challenges while at ISO New England. He was a serious man who loved
to laugh and developed admiration and
friendship with all who worked with
him. May he and all colleagues we
have recently lost be remembered and
rewarded in peace.

p&e

january/february 2021

IEEE Power & Energy Magazine - January/February 2021

Table of Contents for the Digital Edition of IEEE Power & Energy Magazine - January/February 2021