Merit Order
The sequence in which power plants are dispatched to meet electricity demand, ranked from cheapest to most expensive operating cost. Renewables and nuclear (near-zero fuel cost) dispatch first; expensive peaker plants dispatch last.
Why It Matters
Merit order dispatch determines which plants run at any given time and what you pay for electricity. As zero-fuel-cost renewables grow, they push expensive plants off the grid, potentially lowering wholesale electricity prices.
Related Topics
Related Terms
Dispatchable Generation
Power plants that can be turned on, off, or adjusted in output on demand by grid operators. Natural gas, hydropower, nuclear, geothermal, and batteries are dispatchable. Wind and solar are "variable" (weather-dependent).
Peaker Plant
A power plant that operates only during periods of peak electricity demand — typically natural gas simple-cycle turbines that can start up in 5-15 minutes. They run a few hundred hours per year and charge premium electricity rates.
Baseload
The minimum amount of electric power delivered or required over a given period at a constant rate. Historically provided by coal and nuclear plants that run continuously.