Advanced Energy Perspectives

In the advanced energy industry, all eyes are on the incredible shrinking FERC. With now two open seats, the Commission can barely muster a quorum – and not always, as a Trump Administration ethics pledge is keeping Commissioner Richard Glick from participating in important cases. Media outlets have reported that the White House plans to offer a single nomination to fill McIntyre’s seat, a potentially troubling departure from the tradition of pairing Republican and Democratic nominees. In flux as it is, FERC faces a range of pending decisions that could have huge impacts on the nation’s electricity market – and on advanced energy growth. Ultimately, what the advanced energy industry is looking for from FERC Commissioners – those now seated, and new ones to come – is for barriers to competition in wholesale markets to come down.

Given how long we’ve been waiting – nearly three years now – for FERC to issue a final order directing RTOs/ISOs to develop rules for aggregated distributed energy resources (DERs) to take part in wholesale markets, it may seem that actual DER participation is still years away. In reality, several types of DER – from energy storage to distributed solar to electric vehicles and more – are slowly breaking through barriers to participate in wholesale markets, providing value to their owners and the electric power system as a whole. Read on for five real-world examples of DER participation in wholesale markets across the country. These examples provide just a glimpse of the value DERs could bring to wholesale markets, if they were given more of a chance. A final rule from FERC requiring systematic removal of barriers to DER participation in wholesale markets would unlock more of this value for wholesale markets and for consumers.

In July, associations representing utilities and state regulatory agencies asked the United States Court of Appeals for the District of Columbia Circuit to overturn portions of the Federal Energy Regulatory Commission’s landmark Order No. 841. In that order, FERC adopted critical regulatory reforms that require regional wholesale electricity market operators to remove barriers to the participation of energy storage technologies in their markets. Last week, AEE led a broad coalition of clean energy associations and public interest advocates in formally intervening in the case to urge the court to uphold FERC’s bipartisan effort to remove regulatory barriers to the growth of electric storage. The entire advanced energy industry has much at stake.

Last month, AEE filed a petition for declaratory order with the Federal Energy Regulatory Commission (FERC) raising alarm over suggestions that ISO New England (ISO-NE) might implement significant changes to the measurement and verification of energy efficiency resources in the region’s Forward Capacity Market (FCM) without following appropriate procedures. The petition, filed jointly with Sustainable FERC Project, seeks an order from FERC that would protect market participant investments in existing energy efficiency resources from retroactive changes made solely at ISO-NE’s discretion, and ensure that any future changes would occur only through established procedures, including review and approval by stakeholders and ultimate FERC approval.

In 2018, wholesale electricity markets were a bumpy ride for the advanced energy industry. The year began with major victories for the sector, including the Federal Energy Regulatory Commission’s (FERC) unanimous rejection of the Trump Administration’s proposal to bail out uneconomic coal and nuclear power plants, and FERC’s adoption of a final rule (Order 841) opening wholesale electricity markets to energy storage resources.  But headwinds developed as the year went on, including FERC’s June order requiring PJM to make major changes to its capacity market that could result in new barriers to participation for advanced energy resources, and moves in PJM and ISO New England to favor so-called “fuel secure” resources. After a turbulent 2018, what will 2019 bring? Here are some of the key areas where AEE will be engaged to ensure that advanced energy resources can continue to achieve growth in wholesale electricity markets.