Assignment of capability obligation to entities in competitive markets-the concept of reliability equity

Complying with FERC orders 888 and 889, electric utilities in the USA are setting up competitive markets for installed and operable capacity, energy, spinning and nonspinning reserve and automatic generation control. This paper addresses the issues of installed and operable capacity. The possibilities of combining the two markets using reliability as a yardstick is proposed. The proposed market is dynamic (hourly) in which participating entities carry capacity such that all systems have the same reliability.