What are the impediments to renewables in a market system?
The privatization of utility systems has brought a degree of market discipline and economic reality to the electricity business of many nations and has fostered conditions generally conducive to private investment. However, the shift to a short-term market for wholesale electricity may hamper development of new renewable energy generation projects in previously undeveloped resource areas except in those countries that have implemented special policies to offset this result. Projects that depend oh short-term markets for all or most of their revenues are known as merchant plants . Merchant plants are built with the understanding that they have not specifically identified buyers to purchase their output at fixed prices over a long-term (typically 15-20 years). Instead, they sell into the short-term market and receive whatever price the market dictates for that particular week, day, hour or half hour. An electricity market that offers only short-term prices constitutes an inhospitable cli
