EPA

‘We can’t have it both ways: costly mandates without full consumer understanding and support.’

Oklahoma Sen. James Inhofe has made it his mission to block environmental regulations, especially greenhouse gas constraints. His most recent attack targets John Bryson, former Edison International CEO and Pres. Barack Obama’s nominee for Commerce Secretary. But rather than protecting economic interests, as Inhofe purportedly aims to do, his actions have added to the ongoing policy chaos that frustrates clean coal development.

When the U.S. Federal Energy Regulatory Commission issued its so-called ”MOPR“ decision in April 2011, approving a minimum offer price rule (or bid floor) for PJM RPM capacity market — and then on the very next day did much the same for New England’s FCM capacity market — FERC did more than just prop up prices. Instead, it created a nightmare scenario for utilities that still own their own generation. These utilities, who choose to “self-supply” with their own plants, rather than buy capacity from either the RPM or FCM, adequacy rules, could now be forced to pay twice for capacity — if their own plants are deemed inefficient or uneconomic.

Investors historically have been skeptical about merger synergies in utility mergers, assuming that regulators will insist that most or all economic benefits flow to customers. However, recent transactions suggest utilities are taking a different approach to valuing synergies that might strengthen the case for mergers — not just for the merging parties, but also for investors and regulators.

(June 2011) Duke and ATC team up to build transmission lines; AEP installs bioreactor to control selenium emissions; NextEra buys 100 MW of wind from Google; Ocean Power Technologies awards contracts for wave power array; Kansas City picks Elster; BC Hydro picks Itron; plus contracts and developments involving Tres Amigas, Ioxus, Opower and others.

A wave of coal-fired plant retirements presages a possible crisis in the New England market. As load-serving utilities in ISO New England become increasingly dependent on natural gas-fired capacity and large-scale renewable generators, the region might be forced to rely on expensive cost-of-service reliability contracts to keep the lights on. Stakeholders are considering alternative approaches to encouraging power plant development, including special rate incentives previously reserved for transmission projects. Paul J. Hibbard, former Massachusetts DPU chairman and now vice president with the Analysis Group, analyzes how resource constraints are blurring the lines between competitive markets and integrated resource planning in New England.

As the Fukushima-Daiichi crisis unfolds, the U.S. DOE’s Blue Ribbon Commission is preparing its initial recommendations on how America should deal with its commercial nuclear waste. Early indicators suggest it will endorse the so-called fedcorp model—creating an independent federal corporation, similar to TVA. But a fedcorp structure, by itself, won’t resolve the spent-fuel dilemma. Success will require a strong mandate, consistent funding—and a totally new approach to siting and management.

(April 2011) GE Hitachi and Lockheed Martin team up on nuclear reactor controls; Elster wins metering contract in New Hampshire; Xcel hires Bechtel for nuclear services in Minnesota; Mitsubishi builds transformer HQ in Memphis; Northeast Utilities taps Siemens for transmission projects; Iberdrola sells wind output to FirstEnergy; Consumers and DTE invest $400 million to upgrade pumped storage facility; plus contracts and announcements from Alstom, URS, Areva, groSolar, Pattern Energy, S&C Electric and others.