Intermittent RES-E, cycling and spot prices: The role of pricing rules

These two alternative designs result lead for instance to a different remuneration for base-load plants. The first objective of this paper is to explore to what extent this remuneration difference might turn to be relevant as VER (and specifically solar PV) deployment develops. To do so, we also analyze the importance of properly allocating medium-term O&M costs in the short term, a hot topic in the regulation of a number of power markets today. We propose a way to properly calculate the start-up cost-adder component due to O&M and how this cost-adder is affected by cycling operation.