Advanced Energy Perspectives

Just over a month ago, AEE launched a new group of advanced energy users, called the Advanced Energy Buyers Group, led by member companies including Microsoft, Amazon, Walmart, and others. The concept is simple: Just as AEE is the business voice of advanced energy, the Advanced Energy Buyers Group serves as the policy voice of energy users. In practice, that means the Buyers Group will weigh in on a range of energy policy issues that matter to companies on the customer side of the meter, specifically on behalf of companies seeking ways to increase their use of advanced energy.

In the month since its launch, the Buyers Group has kept busy on two high profile issues, both with big implications for large consumers: the Section 201 Solar Trade Case now before the U.S. International Trade Commission and the “Grid Pricing Rule” proposed by the Department of Energy late last month and under consideration by the Federal Energy Regulatory Commission.

Let’s dig in.

Yesterday, House Republican leaders released the “Tax Cuts and Jobs Act,” which is intended to create a better tax and business climate. As a business association, AEE supports efforts to create a better business and tax system for the United States, and this proposal includes some provisions that could be beneficial. Unfortunately, several provisions directly target the advanced energy industry, particularly wind power and electric vehicles, for loss of tax benefits.

The House has announced plans to move quickly on this package, with a hearing scheduled for Monday, Nov. 6, in the Ways and Means Committee. The Senate is also expected to release its own proposal, which will likely differ on key provisions related to the advanced energy industry. We are actively working with Congress and our allies to ensure that the advanced energy industry is not harmed by this and any future tax package.

While still reviewing the 429-page bill, we can see that the advanced energy industry was not ignored by Congress in this high priority, and highly controversial, piece of legislation. But let’s be clear: AEE will fight to make sure that any tax measure approved by Congress recognizes the full value of the advanced energy industry, now a $200 billion industry supporting more than 3 million jobs across the United States.

When the U.S. Dept. of Energy’s long-awaited staff report on grid reliability came out in August, a lot of observers didn’t know what to make of it. In the long run-up to the report’s release, we at AEE had worked with our fellow industry groups AWEA, SEIA, and ACORE to challenge the premise of the study as ordered by Secretary Rick Perry, which was that the electric power system was in jeopardy due to the “premature” retirement of baseload power plants – namely coal and nuclear. When the report came out, it largely vindicated our view that cheap natural gas and slow load growth, not renewable energy policies, were forcing uneconomic power plants out of business, and that the changing mix of resources was being managed reliably by grid operators.

This led some observers to call the report a “rorschach test,” allowing anyone to read into it anything they’d like, or even a “nothingburger” (check out the URL to this analysiss). But we at AEE saw in it just enough grounds for proposing out-of-market financial supports for these uncompetitive power plants that would turn electricity markets upside down – and our CEO Graham Richards said so, in a statement picked up by The New York Times. Lo and behold, on Sept. 30 DOE submitted a proposed rule to the Federal Energy Regulatory Commission (FERC) doing just that, and on an accelerated timeline. Since then, a broad-based coalition of industry groups – call them “strange bedfellows” – has been fighting back against this wrongheaded, costly, and unnecessary bailout of failing power plants.

 A successful transition to a 21st Century Electricity System requires careful consideration of a range of issues that will ultimately redefine the regulatory framework and utility business model while creating new opportunities for third-party providers and customers to contribute to the operation of the electricity system. In this third in a series published by Utility Dive, AEE explores traditional and "pay for performance" approaches to energy efficiency (EE). 

On Sept. 22, AEE hosted a California Gubernatorial Roundtable featuring Treasurer John Chiang. Treasurer Chiang joined AEE staff and our member companies for a lively session focused on the state’s leadership in advanced energy and how the industry is expanding economic development opportunity throughout the state. The roundtable was the first in a series of meetings with all the leading candidates for governor over the next few months. Through these roundtables, we hope to learn more about the candidates’ visions for the state, and we hope they will learn more about the advanced energy industry growing in California.