Electricity Policy

       

Fri02272015

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Considerations for State Regulators and Policymakers in a Post-FERC Order 745 World

Considerations for State Regulators and Policymakers in a Post-FERC Order 745 World

By Peter Cappers and Andy Satchwell

State regulators and policymakers should act now, while demand response is under judicial review, to develop contingency plans to ensure resource adequacy is not jeopardized and that DR remains a robust and economic resource for meeting electricity needs.
 
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y vacating FERC Order 745 in Electric Power Supply Association vs. FERC (“EPSA”)  , the U.S. Court of Appeals for the D.C Circuit injected uncertainty into the future of demand response (DR) resources in U.S. wholesale markets.  Among several things, the decision explicitly identified “incentive-responsive demand” as a retail transaction, not a wholesale transaction.  Thus, demand response, as the industry has come to understand it within the confines of ISO/RTO-administered energy markets, is not under FERC jurisdiction but rather state jurisdiction.  However, if the Court of Appeals’ majority arguments are taken to their logical conclusion, then FERC may not have jurisdiction over DR providing any bulk-power system service, not just energy.

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The Shape of Things to Come: Net Demand

The Shape of Things to Come:  Net Demand

By Bentham Paulos

As wind and solar mature commercially they have novel effects on power system operations, planning, and finances.  With Germany and California in the vanguard, policy solutions are emerging. But to best pursue a clean energy future, we first must change the way we look at our power systems, starting with the daily load profile. 
T

he growth of wind and solar power are introducing a new element into grid operations, and changing the way grid operators look at the system.  Indeed, they are changing the familiar daily shape of the demand profile.

 

If you would like to obtain a complimentary PDF file of Mr Paulos's article on Net Demand, and were unable to sign up for a 30-day free trial to Electricity Daily and ElectricityPolicy.com, please email your request to [email protected].

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A Huge Distribution Opportunity

A Huge Distribution Opportunity

By Paul J. Feldman

The economic cost of outages to electricity customers amounts to nearly one-third of the revenues those customers pay for service, and the problem lies almost entirely with the distribution system.  Fortunately the tools to address this situation are available, if utilities, state regulators, vendors—and customers—can cooperate on a needed fix.
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n 2013 end-use electricity customers in the U.S. paid some $364 billion to their suppliers for electricity service.   The economic cost of outages that customers experienced in that year, however, amounted to approximately $112 billion, not including the full cost of outages that were attributable to extreme weather.   That failure of service represents $1 loss to an end customer for every $3 the customer pays for service.

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What can (or should) we take away from Germany’s renewable energy experience?

What can (or should) we take away from Germany’s renewable energy experience?

By Jürgen Weiss

Germany’s transition from nuclear and coal-fired generation and toward greater reliance on renewable resources and efficiency thus far has been mostly positive in terms of system reliability and maintaining a strong economy.  The US would do well to follow developments there carefully. 
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ermany has committed itself to closing its remaining nuclear power plants by 2022 and to essentially eliminating fossil fuels from its power sector by 2040-2050. To implement the latter, Germany has been aggressively supporting the deployment of renewable energy since about 2000. With over 37 GW of solar PV, Germany is now the world leader in installed capacity, one of the top countries with respect to renewable capacity in absolute and relative terms more broadly, and more or less on track to meet its goals.

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Nuclear Winter

Nuclear Winter

By Robert McCullough, Garrett Oursland, and Rose Anderson

The problems facing the nuclear industry are national in scope and appear to be enduring in effect. Only a major change in the economics of the industry is likely to avoid market-based nuclear plant closures in years to come.

The State of Play

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an existing nuclear power stations be economically viable in a market increasingly dominated by zero short term marginal cost renewables and low natural gas prices?  On that question the jury is still out – and will be for years to come.  But the evidence indicates that a number of existing units have out-of-pocket costs that are greater than today’s market prices.

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Electricity Daily

Mass., Conn., R.I. join together to elicit proposals to develop joint power projects

Mass., Conn., R.I. join together to elicit proposals to develop joint power projects

February 27, 2015 -- The governors of Connecticut, Massachusetts and Rhode Island are uniting to seek ways to increase the region's reliance on renewable energy sources, while also expanding natural gas capacity. Under the plan, electric distribution companies in Massachusetts, Connecticut, and Rhode Island will be asked collaborate with their respective state agencies to begin a competitive biddi...

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Ohio regulator says no to AEP plan to get older plants back under state regulation

Ohio regulator says no to AEP plan to get older plants back under state regulation

The Public Utilities Commission of Ohio on Wednesday rejected American Electric Power’s proposal to assign portions of its Ohio generation lineup to AEP Ohio, its distribution utility in the state. The move, according to its many critics, would have burdened AEP Ohio customers with financial responsibility for old, above-market generation, much of it coal-fired. AEP had said that the generation in q...

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Briefs due at Supreme Court in challenge to EPA's mercury and air toxics rule

Briefs due at Supreme Court in challenge to EPA's mercury and air toxics rule

A case with important consequences for Ohio and other coal-generating states will soon be argued before the US Supreme Court and could decide whether coal-fired power plants must comply with federal rules for mercury and other hazardous air emissions or can escape them. Utilities and other challengers argue that the Environmental Protection Agency unreasonably failed to consider costs in determini...

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Microgrids could make service more reliable, but with what deployment cost?

Microgrids could make service more reliable, but with what deployment cost?

The drumbeat for microgrids is growing. Policy makers, past and present, worry about the grid and the many threats to it. Among them: sophisticated cyber attacks; physical attacks both low-tech (e.g., the armed attack on PG&E’s Metcalf substation near San Jose in 2013) and high-tech (e.g., a nuclear device detonated in the upper atmosphere that could knock out service). Then there is grid crip...

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European Comm. outlines bold proposal toward energy unity, but clouds loom

European Comm. outlines bold proposal toward energy unity, but clouds loom

The European Commission unveiled an ambitious plan Wednesday that would: (1) merge the energy markets of the 28-country bloc, an idea that has been years in the making without much chance of success; (2) inject the EC, the European Union’s executive branch, into all negotiations with Russia; (3) open a now-moribund “southern gas corridor” to bring pipeline gas from Central Asia, and perhaps eventu...

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Fla. solar coalition pushes constitution ballot measure, nixes utility-backed bill

Fla. solar coalition pushes constitution ballot measure, nixes utility-backed bill

February 26, 2015 -- When Florida regulators decided to kill state support for solar in the Sunshine State, they uncorked a keg of pro-solar advocacy, but there’s dispute as to the right approach. Florida State Sen. Jeff Brandes, a St. Petersburg Republican, has filed legislation that would allow those who generate electricity from solar power to sell it to others. But his bill also would allow ut...

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Editorials

Guest editorial: Demand response and electricity market reform: What next?

Guest editorial: Demand response and electricity market reform: What next?

Responding to the excellent paper by Peter Cappers and Andy Satchwell, “ Considerations for State Regulators and Policymakers in a Post-FERC Order 745 World ,” we want to share a conversation that transpired at a recent conference that addressed the issues of reliability in organized markets, the uncertain future for demand response, and what level of government—state or federal—should oversee it. T...

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The virtuous circle of infrastructure investment— a win, win, win proposition

The virtuous circle of infrastructure investment— a win, win, win proposition

In President Dwight D. Eisenhower’s 1955 State of the Union speech, he said, “A modern highway system is essential to meet the needs of our growing population, our expanding economy, and our national security.” Eisenhower led the movement to develop the interstate highway system that links the US, making vehicle travel for transportation, tourism, and the greater economy so accessible that we take...

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Three cheers for state regulators, in Connecticut and elsewhere

Three cheers for state regulators, in Connecticut and elsewhere

State utility regulators are a hard-working lot. They have a tough job and an underappreciated one.

State commission budgets and staff aren’t what they should be. Their resources are unequal to those of the companies they’re supposed to regulate.

The mind-numbing details buried in rate cases, and planning and mergers and other proceedings are not light reading.

Thus, ill-tempered remarks  from Connecti...

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Digging deeper: Competition at the distribution level

Digging deeper: Competition at the distribution level

The pro-competitive reforms introduced into the bulk electricity transmission grid by the Federal Energy Regulatory Commission over the past two decades and more, culminating in FERC Order No. 1000, have transformed what was once a patchwork of transmission monopolies into something more resembling a common carrier system.

Today, as innovation has crept into the local level, with both supply- and d...

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Why should we be concerned with India?

Why should we be concerned with India?

Yesterday we published three articles that concerned India. You may ask why (aside from the dearth of interesting US news). There are several reasons.

  • One story announced US-based SunEdison’s plans to build a $4 billion solar manufacturing factory with an Indian company.
  • A second concerned plans of Rajasthan, one of the largest of India’s 29 states, and the sunniest, to develop 655 MW of solar as th...

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On ‘Nuclear Winter’ …

On ‘Nuclear Winter’ …

Robert McCullough and his associates have written “ Nuclear Winter ,” just published on our website .  Their paper is a sober, fact-based assessment of the predicament facing the owners of today’s nuclear power plants, particularly those that must deal with the unyielding structure of organized wholesale power markets. It concludes that at least seven of the reactors now operating—Callaway, Diablo Can...

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