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Thumbnail 9 - CapacityIn this 2011 report from NERC (from which this category diagram has been taken) the authors describe the Capacity category as follows:

“Demand Resources that displace or augment generation for planning and operating resource adequacy with an obligation to deliver the capacity as energy during a fixed contract period.”
See page 9 of the report (our emphasis added in the above)

With the NEM being an “energy-only” market (hence with no Capacity Market used for generation resources in the ordinary course of events) there is not, ordinarily, the scope provided for this type of Demand Response resource to operate in the NEM.

Under specific circumstances (where the AEMO believes that the market is not providing sufficient capacity) the market operator is able to call tenders for Reserve Trader, which is a specific form of capacity payment in the market.

The AEMO provides this page containing several documents relating to the exercise of Reliability and Emergency Reserve Trader (RERT).

Other articles about the (limited) instances in which Reserve Trader has been deployed have been tagged here.


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