Capacity Energy Markets: a view from Germany and the United States
Capacity Markets and what Germany can Learn from Experiences in the United States - Germany's Energiewende is attracting global attention these days. The country set itself ambitious long-term targets wanting to reach at least 80 percent renewables in its electricity sector by 2050; it is currently at 25 percent. Although Energiewende skeptics forecasted that this development would jeopardize the most stable energy system in the world - for which the average annual power outage is a mere 10-15 minutes - so far this consequence has not materialized. This demonstrates that the existing power system is able to manage at least a 25 percent share of renewables. But exceeding 25 percent will be a crossroad; even the strongest proponents of the Energiewende agree that Germany needs to reform its energy system to accommodate the next influx of renewables. Many respected voices across Germany are calling for an energy capacity market, and they would be wise to look towards the United States for important lessons learned.