Generation Reserves: The Grid Security Question
A cost-benefit study shows the value of adding synchronized generating reserves to prevent blackouts on the scale of Aug.14.
A cost-benefit study shows the value of adding synchronized generating reserves to prevent blackouts on the scale of Aug.14.
FERC's AEP ruling begs the question: Can the feds bypass states that block transmission reform?
Business & Money
FERC's ruling on cash management programs will introduce new transparency into how utilities manage their cash.
On Oct. 22, the Federal Energy Regulatory Commission (FERC) ruled that FERC-regulated entities must file their cash management agreements with the commission and notify the commission within 45 days after the end of each calendar quarter when their proprietary capital ratio drops below 30 percent, and when it subsequently returns to or exceeds 30 percent.
A Survey of Recent PUC Rulings
(November 15, 2003) With most restructuring efforts at a standstill in the energy industry, state public utility commissions (PUCs) have tended to shift their attention back to the art and science of ratemaking. For electric and gas utilities, that has meant a renewed emphasis on the mechanics of setting a maximum allowed rate of return on common equity (ROE).
Commission Watch
The industry requires new analytical tools to incorporate the realities of today's higher risk operating and investment environment into the equity allowance process.
We ask merchant grid developers if anything can ever be done.
The blackout of August 2003 should have come as no surprise. The Department of Energy's May 2002 National Transmission Grid Study finds growing evidence that the U.S. transmission system is in urgent need of modernization.
Commission Watch
How far will FERC go to restore market confidence?
Despite keen industry interest in FERC's proposed "rules of the road," aka new codes of conduct, it appears the industry will have to wait. FERC recently granted extensions for filings, and the commission will not gather all reply comments until Sept. 18. Filings so far point to differences over the proposals, especially in time frames for reporting bad behavior, appropriate monetary penalties, and defining to whom the rules apply.
With just a few changes in reliability rules, regulators could call on consumer loads to boost power reserves for outages and contingencies.
In proposing a standard market design (SMD), the Federal Energy Regulatory Commission (FERC) makes clear that it wants customers to participate in wholesale power markets, such as by bidding an offer to curtail consumption, increase supply, and reduce upward pressure on prices.
"We believe in the direct approach of letting demand bid in the market," says FERC.