Energy Policy & Legislation

LICAP and Its Lessons: A Kink in the Curve

Doubts intensify over New England’s radical new market for electric capacity.

What began nearly two years ago as a simple request by power producers to boost their chances for recovering fixed costs for several power plants in Connecticut has mushroomed into the single most complicated case now pending before FERC.
Byline: 

Bruce W. Radford

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An Expensive Experiment? RTO Dollars and Sense

Financial data raises doubts about whether deregulation benefits outweigh costs.

This year, U.S. electricity consumers will spend more than $1 billion financing the operation of six RTOs. RTO costs have nearly doubled since 2001. Restructuring the energy industry was more costly and more risky than anticipated, and reasonable estimates of RTO costs outweigh nearly all of the benefits anticipated.
Byline: 

Margot Lutzenhiser

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Cross-Subsidies: Getting the Signals Right

Should regulators care about the inefficiencies?

Utilities were founded to create cross-subsidies, but regulators need to address lingering uncertainties about such subsidies in a coherent, constructive way. The authors offer five recommendations.
Byline: 

Sean Casten & Joshua Meyer

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Energy Trading & Marketing: The Evolution of the Deal

Energy traders and risk managers reengineered their business dealings to manage against unexpected political and financial risks posed by California and Enron in 2001.

The rules of energy market survival changed forever in 2001. California and Enron were both humbled by gyrating prices and blackouts in the Golden State, and financial misadventure dethroned the once-crowned king of energy trading. These twin events sent shockwaves through the very foundation of the energy trading and risk management establishment.
Byline: 

Richard Stavros

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Coalition Demands Congressional Action

The Federal Energy Regulatory Commission (FERC) plans to investigate the membership requirements set by the Mid-Continent Area Power Pool (MAPP), especially as they pertain to power marketers (Docket Nos. ER94-1529-001 and 002, and EL95-77-000).

The FERC found last December that certain MAPP membership criteria are framed in terms of traditional utility attributes (em e.g., ownership of generation and transmission facilities, interconnected operation, system load and related reserve obligations (em that entities such as power marketers do not possess.

Byline: 
Lori A. Burkhart
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