As we know, the electric power grid is undergoing a shift from a traditional, centralized electricity system powered by conventional resources to a distributed, diverse system. The advanced energy technologies driving this shift give consumers more choices, improve reliability, and drive down costs for everyone. As this transition occurs, the rules governing electricity markets need to keep up. To fully realize the benefits advanced energy has to offer, we need electricity markets that treat all resources equally, and properly assign value to each of services they provide. Ensuring that markets are fair, transparent, and technology-neutral begins with the governance structures of the seven major grid operators in the United States.
A new paper, Regional Energy Markets: Do Inconsistent Governance Structures Impede U.S. Market Success?, commissioned by AEE member E4TheFuture, outlines how each Regional Transmission Organization (RTO) and Independent System Operator (ISO) operates and how advanced energy companies are able – or not able – to participate in this governance. The focus of the report is the variability between these state and regional entities, which E4TheFuture concludes “make[s] achieving a truly consistent and well-functioning energy market on a national level almost impossible.” But it also shows that the way these grid managers are governed stands in the way of some advanced energy technologies being able to compete on a level playing field with traditional generation and transmission technologies.