Climate Exposure

A state supreme court ruled last fall that damage resulting from climate change allegedly caused by power plant emissions was “reasonably foreseeable,” and therefore litigation expenses were not covered under a general liability insurance policy. The ruling creates an unworkable standard and raises questions about insurance coverage for climate-change liabilities.

While the policyholder was left adrift by Steadfast, the climate change insurance ship certainly hasn’t sailed.

On Sept. 16, 2011, the Supreme Court of Virginia became the highest state court in the country to rule on the issue of insurance coverage for climate-change claims under a general liability policy. In AES Corp. v. Steadfast Ins.

Frequency Regulation

In a recent order, the Federal Energy Regulatory Commission (FERC) said that by paying the wrong price for the ancillary service known as frequency “regulation,” system operators have encouraged too many gas-fired turbines and other conventional fossil power plants to supply regulation service.

Putting market economics ahead of reliability, the Federal Energy Regulatory Commission (FERC) has told regional transmission organizations (RTOs) and other grid system operators (ISOs) to rethink the prices they pay for the ancillary service known as frequency “regulation.”

In short, FERC wants all power plants to do what they do best — recognizing that some may be well adapted to providing regulation service, but others perhaps not.

What's Solar Really Worth?

Requests for proposals to supply solar power facilities frequently specify prices to be stated in only one way—dollars per watt DC, or dollars per kilowatt-hour, for example. But a one-dimensional approach to pricing leads to skewed valuation, because different technologies and system designs produce value in different ways.

As the competition for commercial and utility scale photovoltaic (PV) projects increases, a better method for comparing proposal prices is needed to accurately value each offer. Currently, a common practice is to evaluate projects on a dollar-per-watt ($/W) basis, either DC or AC. This assumption is only valid as long as all the proposals have their DC or AC system sizes the same.

Solar Pink Slip

Election politics portend painful cutbacks.

Whether it deserves it or not, the solar energy industry can’t count on continued government largess, thanks in part to the Solyndra mess. But in the end, Solyndra’s demise might be exactly what the industry needs to wean itself off heavy subsidies and become a mainstream resource.

Going, Going ...

Clean energy jobs will be gone soon, if America fails to commit.

America needs an energy policy today that will bring together our best and brightest, harness the limitless capabilities of our research institutions, and invest whatever it takes to ensure America’s leadership in clean energy technologies. The result will be to create billion-dollar industries and millions of new jobs.

Letters to the Editor

(December 2011) Responding to Contributing Editor John Bewick’s analysis of factors impeding the nuclear renaissance in the wake of the Fukushima disaster. Plus comments about construction work in progress provisions as a strategy for saving ratepayers' money.

People (December 2011)

Iberdrola USA names new vice presidents; Michigan Governor appoints new commission chair; AGA and INGAA name new chief executives; plus senior staff changes at American Electric Power, Dynegy, GDF SUEZ, and others.

Transactions (December 2011)

Riverstone/Carlyle acquire eight power plants; Entergy pays $346 million to NextEra for Rhode Island plant; plus asset sales by First Energy and Thermo Cogen, and debt issues by MarkWest, Atlantic Power, Mississippi Power, and SCE totaling $1.6 billion.

Capacity Value Trap

Are merchant power assets overpriced?

By some measures, merchant power assets look like a bargain, selling for well below their replacement cost. But whether low prices signal a buying opportunity or a value trap depends on the outlook for electricity demand growth—not just in the long term, but also in the fairly immediate future.

Open Access on Trial

The old rules don’t always fit with new commercial realities.

To encourage billions of dollars of investment into America’s transmission grid over the next several decades, the Federal Energy Regulatory Commission (FERC) is restructuring its regulatory policies to bring market-based solutions into the framework for planning, construction, and operation of new transmission lines. The recent Order 1000 is the most dramatic example of this effort. But as FERC has learned before, one set of rules doesn’t serve the financial and commercial needs of all market participants.