Optimal Behaviour of Regulated Firms in SREC Markets
Speaker:
Arvind Shrivats, University of Toronto
Date and Time:
Thursday, April 25, 2019 - 11:45am to 12:15pm
Location:
Fields Institute, Room 230
Abstract:
SREC markets are a relatively novel market-based system to incentivize the production of energy from solar means. A regulator imposes a floor on the amount of energy each regulated firm must generate from solar power in a given period, providing them with certificates for each generated MWh. Firms offset these certificates against the floor, paying a penalty for any lacking certificates. Certificates are tradable assets, allowing firms to purchase / sell them freely. In this work, we formulate a stochastic control problem for generating and trading in SREC markets for a regulated firm and discuss potential takeaways for both a regulated firm under this system and regulatory bodies in charge of designing them.