Advanced Energy Perspectives

In December, we published a list of the top 10 utility regulation trends of 2019. With 2020 now past the halfway point, we check in on the top public utility commission (PUC) actions and trends so far this year. Ten trends stand above the rest, from the impact of COVID on everything, to a growing trend in electric vehicle make-ready investments, to an increasing number of states implementing 100% clean energy targets. And, for the first time, we are including in our curation a key trend in federal regulation of wholesale electricity markets, as it goes directly to the question of who is in charge of energy policy in a changing electricity landscape. Prepare to settle in, as here is the full round-up of the top 10 utility regulation trends so far in 2020.

Note: some links in this post reference PUC filings and other documents in AEE's software platform, PowerSuite. Click here to sign up for a free trial.

Over the past two years, climate change has resurfaced as a top policy priority in Congress with policymakers from both parties offering ways to reduce carbon emissions. AEE has actively engaged in this conversation, testifying to Congress on how the country can achieve a 100% clean energy future in the power sector cost effectively. While many, including AEE, have focused on the need to establish a strong and enforceable target for meeting a 100% clean future, less attention has been paid to the ways wholesale electricity markets could drive toward this target, lowering consumers costs, expanding consumer access to clean energy, and reducing carbon emissions. That is, until now, as federal lawmakers are turning to expansion and improvement of wholesale markets as well as reducing barriers for advanced energy to access these markets as part of their plans.

In the last decade, technology has changed nearly every facet of our lives. We’ve traded in touch-tone phones for smartphones, replaced cabs with ride sharing apps, and upgraded bulky desktops for sleek laptops. While technology has changed life in so many dramatic ways, less obvious, but no less dramatic is the way technological advancements have changed the way we use electricity. Most notable is the way technology has allowed us to gain control over electricity demand, through energy efficiency and demand response. The challenge now is to make sure that newfound power to reduce and manage demand gets fully utilized in wholesale electricity markets.

In 1999, the Texas Legislature passed Senate Bill 7, opening up the Lone Star State’s electricity market to competition. Since then, Texas has been at the forefront of energy innovation. Now, nearly 20 years later, distributed energy resources (DERs) are the cutting edge of energy innovation, continuing the two-decade process of making the Texas grid more secure, clean, reliable, and affordable. With the COVID-19 public health crisis changing where and how we use electricity, just as it has changed where we work and how we learn, DERs couldn’t have come along at a better time. 

As momentum builds for clean energy, the Western states are leading by example. From California to Colorado, Washington to New Mexico, states have set ambitious goals, and are now starting to figure out how to meet them. Suddenly, the notion of a regional power grid, instead of the electric power system managed state by state, has growing appeal in the independent-minded West. Could regionalizing the grid help these states reach their goals? And if so, what would a regional power market look like? AEE has put forward some principles to contribute to the conversation.