Bundled against Change
Mississippi draws a line in the sand.
"We view the [Entergy-ITC] transaction [as] an attempt to extract excess value."-Mississippi PSC
Reliability Pricing Model
Partnership, Not Preemption
How state-sponsored planning can fit with FERC’s capacity markets.
FERC-approved capacity markets and state-sponsored resource planning serve different needs. The one shouldn’t pre-empt the other.
RTO Tango
PJM and MISO ran from the altar once before. Now there’s talk of a shotgun wedding.
Utilities in the Midwest ISO want greater access to sell into PJM’s lucrative market. But that might require a virtual merger of the two RTOs — a move rejected seven years ago as too costly, and perhaps still impractical today.
Trusting Capacity Markets
Does the lack of long-term pricing undermine the financing of new power plants?
The PJM Interconnect’s Reliability Pricing Model generally has succeeded in attracting and retaining low-cost generation and demand resources to maintain resource adequacy. But sluggish demand and low prices have weakened the market for long-term capacity contracts. Suppliers aren’t willing to lock in current low prices, and buyers don’t want to pay more for future certainty. Is the market dysfunctional, as some state lawmakers suggest, or does the lack of long-term contracts indicate a rational balance of supply and demand?
Battle Lines:
2011 Groundbreaking Law & Lawyers Survey and Report
With a flurry of major new environmental regulations, the Environmental Protection Agency (EPA) is altering the power generation landscape. But will the new federal rules survive court challenges—to say nothing of next year’s national elections? Fortnightly's Michael T. Burr considers the controversy over new environmental standards. PLUS: Top Utility Lawyers of 2011.
Bench Report: Top Ten Legal Decisions of 2011
1. ‘Policy’ Guides the Grid; 2. Carbon Not a Nuisance (Yet); 3. Gigabucks for Negawatts; 4. A MOPR, Not a NOPR; 5. Ramp Up the Frequency; 6. Cap-and-Trade Still Lives; 7. Cyber Insecurity; 8. Korridor Killer; 9. The Burden Not Shared; 10. Ozone Can Wait.
Yes, We Have No Negawatts
When you sell demand response back to the grid, how much capacity are you now not buying?
When customers sell demand response into a regional capacity market (such as PJM’s Reliability Pricing Model, known as the RPM), how much credit should they earn for agreeing to curtail demand and alleviating stress on the grid — that is, for reducing the market’s need for generating capability and capacity reserve margin? And further, should the amount of credit depend on whether the customer works with market aggregators, known both as CSPs (“Curtailment Service Providers”) or ARCs (“Aggregators of Retail Customers”)? One view would pay customers for the full extent of their curtailment of demand — known as its “Guaranteed Load Drop” (GLD). The other would limit capacity credit to the customer’s prior load history — “Peak Load Contribution,” or PLC. The answer may well dictate whether regulators continue to treat “energy” and “capacity” as two distinct concepts.
States' Rights, Gamed Markets
Submitted by meacott on Tue, 2011-04-19 18:03FERC OK's PJM's capacity price floor, but questions remain about 'legitimate interests.'
FERC seems to say that states remain free to interfere with RTO markets.
Citing what it called “mounting evidence of risk” that PJM’s RPM capacity market could indeed “be gamed,” the Federal Energy Regulatory Commission (FERC) last week OK’d most of the tariff amendments PJM had proposed to correct flaws in its Minimum Offer Price Rule (MOPR), which allows the grid operator to mitigate or predatory, below-cost bids by suppliers who would sell generating capacity into the region.
Capacity Contest
Raising the stakes in RTO markets.
Generators and demand-response providers are reaping rewards in forward capacity auctions, causing suppliers to go shopping for the most lucrative markets. Now the Midwest ISO is trying to catch up, by proposing its own auction for years-ahead resource bids. But does RTO shopping serve the interests of customers, who are legally entitled to rates that are just and reasonable? Why are some state policy makers advocating a return to old-school RFPs for long-term contracts?
Parochial Power Play
Northeastern politicians declare war on capacity auctions.
New Jersey Gov. Chris Christie in February signed into law a bill that will have the state commissioning construction of 2,000 MW of new gas-fired power capacity and dumping it into the PJM capacity market at a $0 price. Maryland is considering a similar capacity-dumping scheme. What’s behind these efforts to manipulate capacity auctions — regional constraints or local politics?