Transmission

Grid system operators now hold the cards. That means a bidding war for talent and a new wave of mergers.

TBy issuing new rules for a Standard Market Design (SMD) for wholesale power, the Federal Energy Regulatory Commission (FERC) in all likelihood will usher in a new wave of utility mergers. But the pattern will differ from what we have seen in recent years.

The deals will center on the transmission sector, and take a horizontal shape, rather than vertical.

 

Why power plants should pay for grid upgrades.

Do we make all generators equal-using affirmative action to give rights to merchants that are "comparable" to utility-owned plants?

Or, do we let the locational price signals shine through-trusting all plant developers, whether regulated or not, to act in self-interest?

 

RTO cost/benefit studies are difficult to reconcile.

The premise behind the Federal Energy Regulatory Commission's (FERC) push for regional transmission organizations (RTOs)-that they will provide positive economic benefits to society- increasingly is being challenged.

A year ago, when a group of electric utilities in the Southwest signed off on deals to hook up new generators in Arizona with an innovative "common bus" treatment for two adjoining switchyards at the Palo Verde hub, the Federal Energy Regulatory Commission (FERC) was quick to heap on the praise. "Attaboy," said FERC's Pat Wood, at the commission's meeting of July 25, 2001. Nevertheless, over the past twelve months, FERC twice has proposed new rules to govern the way in which new power plants gain the right to interconnect with the interstate transmission grid. These new rules on gen interconnection form an essential part of the puzzle more aptly known as the standard market design (SMD).

 

Some thoughts on who should take the lead and how to set up financial incentives.

One of the most interesting questions that arises from federal restructuring of the electric grid, with regional transmission organizations (RTOs) and a standard market design (SMD), concerns the risk of building transmission in an RTO environment.

And where the trouble spots lie in FERC's grid plan.

The mood appeared calm on June 26 in Washington, D.C., at the regular bi-weekly meeting of the U.S. Federal Energy Regulatory Commission (FERC). Key officials from various regional transmission organizations (RTOs) had gathered before chairman Pat Wood and the other commissioners to brief them on progress over the past year in reforming wholesale electric markets, and on what the FERC might expect in the summer at hand.