Contracts for dispatchable power

Competitive bidding for electric power is maturing. Increasing numbers of utilities are soliciting proposals from private suppliers. The amount of capacity being sought is increasing, and potential suppliers appear to be abundant. Analysis of these developments still remains limited. Evidence on the behavior of this market is scarce and sketchy. The underlying economic principles that are shaping the market have not clearly been articulated. In this report we examine the economics of competitive bidding both empirically and analytically. Previous study of this market has focused on the evaluation criteria specified in Requests for Proposals (RFPs), and highly aggregated summary statistics on participation and results. We continue the examination of RFPs, but also survey the details of long term contracts that have emerged from competitive bidding. Contracts provide a new level of specific detail that has not been previously available. 68 refs., 13 figs., 25 tabs.