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What happens to the future value of wind and solar when 40+ GW of new load hits the ERCOT grid - and new renewables supply is constrained by the One Big Beautiful Bill? Our new capture curves can help you find out.

A capture curve illustrates how the value of renewable energy compares to the average value of electricity in the market over time. Because solar and wind are intermittent resources, they only generate during certain hours, rather than evenly throughout the day like dispatchable or baseload resources. This means their value is weighted toward the price at those specific hours, which may differ from the times of highest market prices.

Comparing the market price to the prices when solar or wind generates gives us a capture rate. Displaying that capture rate over time is called a capture curve. By measuring capture rates over time, we can visualize how solar and wind are expected to change in value as the grid evolves over the next 15+ years, factoring in market conditions such as renewable penetration and energy storage buildout.

What makes our capture curves unique is the ability to model different offtake structures and two different ERCOT net load scenarios. For example, see how a slowdown in renewables build-out under the OBBBA could impact the relative value of solar and wind over time. Or test how a $0 price floor could increase the value of a solar or wind shape.

How You Can Use Capture Curves:

• Revenue Forecasting: They help estimate the actual income streams by reflecting market price dynamics rather than simple baseload assumptions.
• PPA and Deal Structuring: For originators and analysts, capture curves give a more realistic basis for negotiating PPA prices, setting discount rates, and structuring offtake products.
• Portfolio Management: By showing how future revenues will likely vary by technology, region, and time, they allow portfolio managers to plan diversification, optimize dispatch, and model downside risk.
• Investor Communication: Capture curves help explain to investors why headline wholesale prices are not equal to project revenues, and they provide a market-tested basis for showing expected returns.
• Benchmarking & Market Signals: Since they are market-based, they can serve as benchmarks against peers and reveal trends like the impact of negative prices, cannibalization, or volatility.

How They Are Calculated:

1. Hourly Price Forecast - Every day, we simulate a new hourly price forecast for each settlement point in ERCOT and PJM.
2. Project Generation - The amount of power produced by a given resource (in this case, solar or wind) in each hour. This is provided via standard generation profiles.
3. Project Revenue – Multiply the project's expected hourly generation by the hourly prices, then sum the results over the desired period.
4. Generation-Weighted Value - The average price for a MWh generated by the project. To derive this, divide the project revenue by the project's generation.
5. Average Market Price – Take the average of all hourly prices over the same period (24/7, also known as ATC or around-the-clock value)
6. Capture Rate – Divide the project’s generation-weighted value by the average market price.

To learn more, request a demo here.

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