EPSA: Competitive Electricity Suppliers Are Critical for Green Economy, Climate Goals
December 24, 2008 // Published as a news service by IHS
John E. Shelk, president and CEO of the Electric Power Supply Association (EPSA), reaffirmed that competitive electricity suppliers are critical to the development of the efficient and innovative methods of generating electricity needed to meet the incoming U.S. federal government administration's goals of advancing a green economy and addressing global climate change.
Shelk made his remarks at Michigan State University's Institute of Public Utilities Annual Regulatory Policy Conference during a panel on the new administration's regulatory policy agenda.
"Achieving laudable green economy, economic stimulus and climate goals will require an electricity system that is even more open to innovation," said Shelk.
"Competitive suppliers are uniquely positioned to provide that innovation, as they have demonstrated by leading the way in deploying renewable technologies, cleaner and more efficient natural gas technology and accomplishing more efficient operation of nuclear and coal plants."
"In addition, competitive suppliers built over 80% of power generation during the last build-out and did so at the investors' and not the customers' risk."
Shelk also made several policy recommendations:
- Moving forward early on climate change should be the top energy and environmental priority. Putting a price on carbon while facilitating new cleaner investment through loan guarantees and R&D support for carbon capture and sequestration is essential in order to overcome current climate policy uncertainty that is contributing to delays in required investments.
- The EPSA urges the new administration and the new Congress to carefully consider and integrate electricity policy with environmental policy to make sure the now-Balkanized electricity systems are more fully consistent with bringing lower carbon, affordable and reliable electricity to consumers.
This can best be achieved by continuing the bipartisan work of the Federal Energy Regulatory Commission (FERC) to lower barriers to access for all forms of generation and demand response, thus promoting investment.
- Regulators should continue to monitor and refine the regional organized electricity markets. However, it is important to rebuff attempts to roll back the regional markets, because these markets provide an electricity system that fosters innovation and welcomes new entrants.
As demonstrated by the robust growth of wind generation in organized power markets, they provide greater ease of access to the grid and clearer market signals to encourage investment in renewables and innovative technologies. The existence of regional transmission organizations (RTOs) and international standards organizations (ITOs) are essential to achieving the new administration's green economy and climate goals.
- The one-third of the country that does not lie within an RTO must be encouraged to adopt better open access transmission and greater market access.
- It is important to coordinate federal and state electricity policy. In particular, the FERC-NARUC (National Association of Regulatory Utility Commissioners) collaborative on competitive power procurement can play an important role in the green economy by spurring more competitive power contracts, more easily attracting the $600-$700B in new generation investment expected over the next 20 years and encouraging this new generation to be developed with maximum efficiency.
More widespread adoption of competitive procurement will allow all types of suppliers to come forward and participate in regional markets on fair terms.
EPSA is on record as the first multi-fuel electricity trade association to support federal mandatory market-based economy-wide legislation, the association said.
Source: Electric Power Supply Association (EPSA).