Variability among state/regional structures and rules is a barrier to achieving a well-functioning energy market that provides clean and cost-effective electricity. That’s the conclusion of a paper published by VAEEC Business Platinum member E4TheFuture, November’s Featured Member of the Month. E4TheFuture intends that the paper will help inform organizations who wish to improve governance structures and market rules.
Which areas of the U.S. enable the voices of clean energy and advanced energy technology advocates as decision-makers in the market structures — such as PJM Interconnection* — that govern their playing field? To what extent are these voices provided a vote, compared with traditional power generators, transmission and distribution companies, utility regulators, and “legacy” leadership? How is the Federal Energy Regulatory Agency (FERC) involved? Can missed opportunities of the past be transformed from challenges into opportunities? These questions are raised in E4TheFuture’s paper, authored by Synapse Energy Economics consultants with an introduction and conclusions by E4TheFuture. The paper, Regional Energy Markets: Do Inconsistent Governance Structures Impede U.S. Market Success?, is available as a free download.
VAEEC member E4TheFuture is a nonprofit that promotes residential clean energy and sustainable resource solutions to advance climate protection and economic fairness. The organization does this by influencing federal, state and local policies, and by helping to build a resilient and vibrant energy efficiency and clean energy sector. “E4” stands for energy, economy, equity, and environment: promoting clean, efficient Energy; growing a low-carbon Economy; ensuring low-income residents can access clean, efficient, affordable energy (Equity); restoring a healthy Environment for people, prosperity and the planet. E4TheFuture was known as Conservation Services Group (CSG), until the sale of its operating programs and brand in 2015 to CLEAResult.
In August 2016 president of E4TheFuture Steve Cowell, with Sarah Jackson and Paul Peterson of Synapse Energy Economics, hosted a briefing call about the Regional Energy Markets paper. Jackson and Peterson reviewed each region’s market governance structure, noting what Synapse found and inviting questions.
Of particular interest to VAEEC, it was noted during the briefing that PJM’s current voting members representing advanced energy technology interests are a fragmented group of small companies, which results in a diluted voice on these issues. Paul Peterson pointed out that wind energy advocates are active but overall, more participation by clean energy advocates either via the Public Interest & Environmental Organizations User Group or through development of a separate voting sector such as the Alternative Resources sector in New England, may be helpful. Steve Cowell raised the possibility of creating a user group for PJM’s alternative resource sector, which might be able to evolve into such a voting sector.
“The full range of resources should be explicitly included,” says Steve. “Clean energy resources such as energy efficiency and other distributed energy resources along with demand response need to be more strongly represented in wholesale electricity markets through a more evolved ISO and RTO governance.”
A September 2016 blog by Dylan Reed and Arvin Ganesan of Advanced Energy Economy (AEE), How Grid Governance Stands in the Way of Advanced Energy Progress, recaps the paper’s highlights with additional AEE commentary on the challenges advanced energy resources face under the current variable structures of regional and state electricity market governance.
*PJM Interconnection coordinates the movement of wholesale electricity and ensures power supplies for 61 million people in 13 states & D.C. On October 21, a new Learning Center highlights features of the Markets and Operations page: a real-time snapshot of PJM’s operations and markets, current load, fuel mix, locational marginal prices and ancillary services. The new page explains the dashboard’s wind and solar power graphs.