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| Main Authors: | , , |
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| Format: | Preprint |
| Published: |
2025
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| Subjects: | |
| Online Access: | https://arxiv.org/abs/2508.20913 |
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| _version_ | 1866917171111657472 |
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| author | Suski, Adam Spyrou, Elina Green, Richard |
| author_facet | Suski, Adam Spyrou, Elina Green, Richard |
| contents | The ability of deeply decarbonised power systems to ensure adequacy may increasingly depend on long-duration energy storage (LDES). A central challenge is whether capacity markets (CMs), originally designed around thermal generation, can provide efficient investment signals when storage becomes a central participant. While recent studies have advanced methods for accrediting variable renewables and short-duration storage, the effectiveness of these methods in CMs with substantial LDES penetration remains largely unexplored. To address this gap, we extend a two-stage stochastic equilibrium investment model by endogenising continuous, duration-based capacity accreditation for storage and apply it to a Great Britain-based case using 40 years of weather-driven demand and renewable profiles under varying emission limits. Results show that well-calibrated CMs can sustain near-efficient investment and mitigate revenue volatility, but their effectiveness diminishes in deeply decarbonized systems, underscoring both their potential and the regulatory challenges of supporting large-scale LDES. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2508_20913 |
| institution | arXiv |
| publishDate | 2025 |
| record_format | arxiv |
| spellingShingle | Missing Money and Market-Based Adequacy in Deeply Decarbonized Power Systems with Long-Duration Energy Storage Suski, Adam Spyrou, Elina Green, Richard Systems and Control The ability of deeply decarbonised power systems to ensure adequacy may increasingly depend on long-duration energy storage (LDES). A central challenge is whether capacity markets (CMs), originally designed around thermal generation, can provide efficient investment signals when storage becomes a central participant. While recent studies have advanced methods for accrediting variable renewables and short-duration storage, the effectiveness of these methods in CMs with substantial LDES penetration remains largely unexplored. To address this gap, we extend a two-stage stochastic equilibrium investment model by endogenising continuous, duration-based capacity accreditation for storage and apply it to a Great Britain-based case using 40 years of weather-driven demand and renewable profiles under varying emission limits. Results show that well-calibrated CMs can sustain near-efficient investment and mitigate revenue volatility, but their effectiveness diminishes in deeply decarbonized systems, underscoring both their potential and the regulatory challenges of supporting large-scale LDES. |
| title | Missing Money and Market-Based Adequacy in Deeply Decarbonized Power Systems with Long-Duration Energy Storage |
| topic | Systems and Control |
| url | https://arxiv.org/abs/2508.20913 |