New auction design boosts renewable energy efficiency and lowers costs.
Renewable energy auctions often lead to too many plants in highly productive areas far from where the energy is needed. To fix this, a new auction design allows for regional target capacities, simple pricing, and package bids. This design can lead to optimal energy distribution without raising costs, as shown in comparisons with other auction formats. The prices in this new design are fair and can be calculated quickly, even for large-scale problems.