Expert survey on capacity markets in the US: Lessons for the EU

• Survey of experts on US capacity markets.
• Use of energy-only markets over capacity markets is recommended for the EU.
• Cross-border effects are not a concern but may become so in the future.
• US capacity markets have achieved their goals, but inefficiently.

We present a survey of US capacity market experts with the purpose of drawing lessons for the EU. Of the respondents, 41% advised EU member states against implementing capacity markets, while the remaining were neutral or provided suggestions for improving capacity markets. Cross-border effects are currently not a concern but may become so in the future. Imports may dampen prices in a capacity market, but neighbouring markets may also experience pressure to implement a capacity market. The capacity markets in the USA were believed to have achieved their goals with respect to reliability, but in an economically inefficient manner.