Electricity Policy



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Utility 2.0 is upon us, but Regulation 2.0?--we're still far from an agreed approach

craverimageThere was broad agreement at last week’s Powering the People event, “Connected Conversations,” that Utility 2.0 is upon us and that utilities increasingly need to be customer-focused to serve as the platform for innovation. But what about Regulation 2.0? There was discussion about the need for rate innovation, including time-differentiated rates. Edison International chairman, president, and CEO Ted Craver said, “We believe we will be facilitators for…distributed energy resources, and [resources] we can’t even think of today.” Customers want clean energy and reliable service at a reasonable price, but price—aye, there’s the rub. Some customers want higher reliability and power quality, but not everyone wants to pay for it. D.C. Public Service Commission Chairman Betty Anne Kane highlighted the District’s multi-agency $1 billion undergrounding program that will vastly improve reliability, but admitted that it probably never would have come together were it not for the derecho storm that knocked power out for many Pepco customers for over a week. Under Regulation 2.0, will regulators be able to induce service and reliability goals while assuring cost recovery to the platform providers?

Does renewable energy increase rates?


Renewable energy is often seen as responsible for higher electricity rates in states that support wind and solar energy projects, as battles in the Colorado legislature and elsewhere have shown, but according to a new study that’s not so, as Mark Jaffe’s blogin the Denver Post explains. A study by Nancy Pfund and Anand Chhabara says there is no evidence to show that renewables alone have that effect. The study “Renewables Are Driving up Electricity Prices – Wait, What?” looks at the top ten states for renewable energy, the ten states with the least renewable energy, and national averages. Pfund, managing partner in DBL Investors, a San Francisco-based venture capital firm specializing in clean technologies and sustainable enterprises, says, “Basically we didn’t find much difference and I think that’s the point.” In their analysis the top ten states in renewable energy had an average increase in retail electricity prices of 3.06% between 2002 and 2013. The ten states with the least renewable energy generation had a 3.74% increase, while the national average was 3.23 percent. 

Illinois cities’ aggregation consortium cites past savings, opts for Integrys deal

highlandparkILimageThe City of Highland Park, Illinois, one of eight communities that make up the North Shore Electricity Aggregation Consortium, has recommended a new electricity aggregation contract with Integrys to be effective June 1. Residents of the eight cities that did not opt out of the initial aggregation program have been receiving fixed price electric supply at reduced rates per kWh since June 1, 2012 when the consortium entered into a three-year agreement with MC Squared Energy Services. Over the past three years, the consortium says it saved participating customers more than $30 million collectively, compared with the ComEd default rate. Integrys not only offered the lowest bid, but also would allow customers to monitor the ComEd rate and switch to it if it became lower than the Integrys rate. The consortium’s decision to opt for a new deal with Integrys will not prevent residents from seeking their own alternative retail electric supplier, however.

FERC rejects CAISO EIM waiver request; BPA, PNW utilities, have issues to resolve

CAISO_EIM_imageBy Bill Henry

March 23, 2015—The Federal Energy Regulatory Commission has rejected the California ISO’s most recent filing seeking a waiver from inadvertent high prices in the ISO’s new energy imbalance market with PacifiCorp, which is soon to be expanded to include other Northwest utilities.

FERC rejected CAISO’s Jan. 15 request for tariff revisions that would have modified EIM clearing price calculations for a period of 12 months for new participants. Since the EIM went live on Nov. 1 with PacifiCorp as a member the ISO has twice asked FERC—and was twice granted temporary waivers—to institute this modification. FERC extended the waver for another 90 days, but denied the ISO’s requested 12-month “transition period” for new EIM participants: NV Energy, which will join the EIM in October, and Puget Sound Energy, which will join a year later.

Other Northwest utilities are evaluating whether to join the EIM or to stick with the Northwest Power Pool’s effort to create the equivalent of a Northwest EIM.