As renewables are increasingly added to the grid, market participants are finding that energy revenues from both new and existing generators may vary significantly from their expectations. As policymakers consider subsidies for other types of generation such as nuclear or other baseload units and corporations invest in grid scale renewables, understanding price formation becomes increasingly important.

The blow-up over DOE Secretary Perry's memo requesting the grid study about reliability and resilience was unsurprising, if you consider that it was the first and almost the only statement about federal electricity policy in the first six months of a new administration.¹