Exclusive interviews with the CEOs of five regional transmission systems.
Exclusive interviews with CEOs at five regional independent transmission system operators: Phil Harris, at PJM; Gordon van Welie, at ISO New England; Yakout Monsour, at the California ISO; Graham Edwards, at MISO; and Mark Lynch, at the New York ISO.
The absence of long-term transmission rights could exclude potential competition—and cause higher electricity costs.
Power-industry restructuring redistributed financial uncertainties that discourage generation investment and ultimately raise the price of electricity to consumers.
(March 2006) FirstEnergy Corp. named Bennett L. Gaines vice president and CIO. PPL Corp. named Matt Simmons vice president and controller. NorthWestern Corp., d/b/a NorthWestern Energy, named D. Louis Peoples to its board of directors. The Nuclear Regulatory Commission’s Advisory Committee on Reactor Safeguards re-elected Dr. Graham B. Wallis as chairman, Dr. William J. Shack as vice-chairman, and John D. Sieber as member-at-large. And others...
FERC says it won’t ‘change’ the native-load preference, but don’t bet on it.
When FERC opened wholesale power markets to competition a decade ago in Order No. 888, it codified a system for awarding grid access known as the pro forma Open-Access Transmission Tariff (OATT), founded on physical rights, and on the fiction that electrons travel along a “contract path.” Should the commission “tinker” with the OATT, making only surgical changes to make it current? Or, do events instead warrant a complete overhaul?
FERC mulls rival plans at the last minute, while on the West Coast, California gets into the game.
FERC, the ISO, and many other parties had seen no reason for further debate over the need for a location-specific capacity market. By limiting debate, FERC had foreclosed a raft of competing ideas. When the moment finally arrived for the oral argument at FERC, attorneys and witnesses attempted valiantly in the precious few minutes allotted each speaker to flesh out new ideas, and the commissioners struggled as well to keep up. This highly unusual situation made for a helter-skelter hearing, with new topics seeming to come out of the woodwork.
The bias in RTO markets, and how FERC might fix it.
RTO practice creates less risk and uncertainty over the nominal short-term wholesale price of power, but more risk and uncertainty over the long-term cost of transmission. That spells trouble for the coal-fired plant, sited far off at the mine mouth, needing long-haul transmission over a long-enough term to pay back the capital costs.
FERC must align the immediate self-interest of profit-maximizing entities with its own view of what is in the public interest.
Two obstacles must be overcome to achieve true competitive markets: reversal of the long-term underinvestment in transmission, and greater clarity in the legal and regulatory environments. How can the industry make the most of a somewhat defensive regulatory posture?
Financial data raises doubts about whether deregulation benefits outweigh costs.
Transmission Upgrades:
How to allocate the costs.
Efforts to establish and quantify congestion-reduction and loss-reduction projects are progressing in electric markets with locational marginal price (LMP) regimes. The Path 15 upgrade approval by the California ISO two years ago was largely based upon its economic benefits. A draft report from the Electric Reliability Council of Texas (ERCOT), , states that ERCOT will consider transmission projects that are "economically justified by the reduction of congestion and losses."1
STATE REGULATORS:
Can natural gas supply keep up with demand for power?
Interviews
Things are looking up for the energy industry, but tough issues remain. Regulators-forced to grapple with the mismatch between volatile natural-gas prices and years of building gas-fired power plants-have learned a thing or two. They now insist on new rate schemes and risk-management methods while promoting the use of liquefied natural gas.