Research on Capacity Market Settlement Method Based on VCG Mechanism

The capacity market mechanism is a typical capacity guarantee mechanism that can guide power generation investment and ensure the reliability of the power system. This paper builds a capacity market clearing model and proposes a capacity market settlement method based on the Vickrey-Clarke-Groves (VCG) mechanism. The capacity substitution value of the unit to the system is analyzed through examples. With the method proposed in this paper, the generator can recover the capacity cost while obtaining the system capacity substitution value reward, which has a good incentive effect.