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Coordination of Non-Utility Generation Through Priority Purchase Contracts

This paper proposes the use of priority purchase contracts as a means to coordinate utility purchases from non-utility generators. It is shown that differentiated contracts should have the potential for attracting more diverse, NUG proposals (in terms of technical and economic characteristics). It is also argued that differentiated contracts should permit better integration and coordination of NUG capacity since they come closer to mimicking the utility's resource allocation problem. Several areas for future research are suggested.

Purchase ( $25 )

Energy Specializations: Electricity – Distributed Generation; Electricity – Markets and Prices

JEL Codes: L95: Gas Utilities; Pipelines; Water Utilities, Q41: Energy: Demand and Supply; Prices, Q48: Energy: Government Policy, L94: Electric Utilities

Keywords: Electricity. Non-utility generation, Priority purchase contracts, policy

DOI: 10.5547/ISSN0195-6574-EJ-Vol15-No1-11

Published in Volume15, Number 1 of the bi-monthly journal of the IAEE's Energy Economics Education Foundation.