The competitive transmission genie is out of the bottle.
Elliot Roseman and Ken Collison are vice presidents at ICF International. Kiran Kumaraswamy is a senior manager at ICF.
The structure of the transmission industry is changing substantially, and will continue to do so for some time to come. With the advent of competition, there will be both legacy and new transmission players, with opportunities opening up for both progressive utilities and independent transmission companies alike.
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How can we make such a statement? It's supported by strong precedent in power generation, as well as ongoing trends in the evolution of markets and business models.
Back in the late 1970s and early 1980s, the U.S. Congress heralded a revolutionary development, when it enacted the Public Utility Regulatory Policies Act (PURPA). For the first time, the law obligated utilities to purchase generation capacity and energy from others rather than only build it themselves. These new upstarts - qualifying facilities (QF) or so-called "PURPA machines" - had to meet strict efficiency and size criteria. For QFs that succeeded in being built and coming on line, utilities were required to provide interconnection service and to calculate and pay the utility's avoided cost for their entire output.