For decades now, wind turbines have been generating electricity more cheaply than most other (non-hydro) renewable energy technologies. In particular, wind has maintained a comfortable lead over solar energy in the price-per-kWh race. That’s destined to change.
(May 2010) Duke Energy named Catherine Heigel to the new position of president of its South Carolina service region. Exelon promoted David C. Brown to senior v.p., federal government affairs and public policy, leading the company’s Washington, D.C., office. CMS Energy promoted John G. Russell to CMS Energy and Consumers Energy president and CEO from president and COO of Consumers Energy. And others.
Why similar U.S and Canadian risk profiles yield varied rate-making results.
James M. Coyne and John Trogonoski
Cost of capital is often a contentious issue in utility ratemaking. This is due, in part, to the inexact nature of the tools available to financial analysts and the considerable room for divergent opinions on key inputs to cost-of-capital estimation. Perhaps for this very reason, and to achieve regulatory efficiency, Canadian regulators widely adopted a formulaic approach to setting return on equity (ROE). However, an unusual degree of rancor has evolved north of the border as allowed ROEs in Canada, once at parity, have fallen near 200-basis points below their U.S. peers.
New England grapples with excess capacity and rock-bottom prices.
Bruce W. Radford
“Corrosive.” “Seriously flawed.” On the “brink of market failure.”That’s what critics say about New England’s forward capacity market (FCM), whereby ISO New England conducts auctions to solicit offers from project developers to make electric capacity available three years into the future to meet anticipated regional demand.
Advancements in forecasting have improved the reliability of day-ahead and hour-ahead estimates of wind generation. Wind never will behave like a base-load power plant. But as system operators integrate wind forecasts into their planning and market processes, they’re transforming intermittent wind energy into a variable but reliable resource.
Quantifying the economic benefits of generation alternatives.
Donald Harker and Peter Hans Hirschboeck
Are renewables truly marking the start of a new economy, creating both economic growth and reliable jobs? Answering that question takes a complex analysis, but the numbers suggest green benefits might be smaller than expected.
Constitutional questions about state-mandated renewable tariffs.
Steven Ferrey et al.
Despite state efforts to follow the European model of state-mandated feed-in tariffs to promote renewable power, these actions won’t pass Constitutional muster. The Supremacy Clause makes a formidable legal barrier to states’ FIT policies.
The one-day-in-10-years criterion for capacity planning is coming under scrutiny. Making the most of the smart grid and demand management requires a less conservative approach. Markets and prices rather than administrative rules will ensure resource adequacy in a more efficient way.
In almost all business and non-profit environments, change is occurring at an accelerating pace. In the electric industry—which used to be stable—we are seeing major changes too. Utilities face growing ambiguity as well as increasing paces of change, uncertainty and complexity. As Irene Sanders stated in Strategic Thinking and the New Science, “[t]hat the future will be different from today is given. What we struggle with is our desire to know how it will be different and what we can do to influence it.”1
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