Some advocates claim markets can help reduce electricity prices by changing the design of wholesale auctions. However, taking a pay-as-bid approach could make matters worse.
Keep Your Eye on the South
The Southeast again is the battleground for fuels, technology, and market structure.
given notices to withdraw from the utility.
Slicing & Dicing SERC
The SERC Reliability Corp. (SERC) is the regional reliability organization responsible for the coordination of the operation and planning of the bulk power system across 13 Southeastern states. SERC is one of the largest NERC regional markets both in energy and peak demand. SERC is highly interconnected with the transmission systems in the neighboring NERC regions of RFC, FRCC, and SPP. The general characteristics of the electricity markets in SERC are summarized in Table 1 (see p. 18).
Through January 2006, SERC had been divided into four subregions. These four subregions include the Virginia and Carolinas (VACAR) subregion (further divided into VACAR North-Virginia, and VACAR South-Carolinas); the TVA subregion; the Southern subregion (consisting of the states of Georgia, Alabama, part of Mississippi, and the panhandle of Florida); and Entergy (parts of Arkansas, Louisiana, Mississippi, and Texas). Entergy, Southern Co., TVA, Duke, Carolina Power & Light, and Dominion Resources are the dominant players in the SERC subregions.
In November 2005, NERC approved the merger of the reliability councils of MAIN, ECAR, and MAPP into Reliability First (RFC), which became operational on Jan. 1, 2006. Some of MAIN utilities have opted out of RFC and chose to join SERC instead. Among these was Ameren, which became part of SERC in January, extending its footprint into Illinois as shown in Figure 7. Other new Illinois-based SERC members include Southern Illinois Power Cooperative and the Illinois Municipal Electric Agency. With the influx of new Illinois-based members, SERC added a fifth subregion to its system—the Gateway subregion. The integration of the Gateway subregion into SERC expanded the reliability organization’s scope to include MISO members for the first time.
Effective Jan. 1 2007, SERC’s footprint expanded further to integrate Louisville Gas and Electric Co. and Kentucky Utilities Co., operating subsidiaries of EON. EON changed its regional reliability council membership from RFC to SERC as part of its withdrawal from MISO in September 2006. EON contracted with TVA to serve as its reliability coordinator and delegated independent transmission operator (ITO) duties to SPP. To address coordination and seams issues, EON plans to utilize the Joint Reliability Coordination Agreement among TVA, MISO, and the PJM Interconnection.
1. In addition, we include about 12,000 MW coal-fired additions to repower older coal-fired capacity that retires during the study period.
2. This continues to be true despite the fact that higher natural gas prices have provided improved on-peak spark spreads for new, highly efficient gas-fired generation.
3. Historical retail electricity rates have averaged 7 to 7.5 cents/kWh in the South compared with 12 cents/kWh or more in New England and New York.