Research on Generation Capacity Cost Recovery Mechanism of the New Power System

One of the main characteristics of the new power system is flexibility and resilience. The power generation cost recovery mechanism that considers the abundance of power generation capacity can effectively ensure the safety of power supply and reflect the value of the system's flexible provider. Based on the comparative analysis of the scarcity pricing mechanism, the capacity market mechanism, and the capacity compensation mechanism adopted by countries and regions in the competitive wholesale electricity market, it designs a new type of power system generation capacity compensation mechanism. Compensation standards of capacity and methods for calculating compensable capacity are also proposed in the paper. Starting from the practical experience of the new power system, the operation mechanism of the capacity compensation and its possible impact are analyzed. The research shows that the capacity compensation mechanism can reflect the market demand for capacity and reflect the difference in the contribution of different generator units to the system capacity. At the initial stage of new power system promotion, it provides a stable expectation for the recovery of the capacity cost of various generating units, and then guides the optimal allocation of power generation resources.