The Texas Energy-Only Resource Adequacy Mechanism

On Sept. 13, 2006, the Public Utility Commission of Texas put into effect a new Resource Adequacy and Market Power Rule which establishes an Energy-Only resource adequacy mechanism in the ERCOT electricity market, relaxes the $1,000 per MWh offer cap, and replaced existing market mitigation procedures with more market transparency and prompt information disclosure. The authors describe the motivation and rationale underlying the new rule, its development process, and its implementation details. (author)