Advanced Energy Perspectives

DC UPDATE: Advanced Energy and FERC, or What Binz Could Inherit

Posted by Christian Termyn

Aug 29, 2013 3:42:00 PM


FERC_chairman_Moniz_confirmationThe media has grabbed onto the brewing hubbub over President Obama’s nominee to the Federal Energy Regulatory Commission (FERC). Ron Binz, Obama’s pick for FERC Chairman, boasts considerable experience as a Colorado state regulator and energy consultant and has received praise from industry and former regulators alike. Ben Fowke, who heads Xcel Energy, a major Colorado utility, noted that as a result of Binz’s leadership as utility commission chairman, “customer costs remain well below national averages, emissions were reduced by more than 80 percent, and fuel diversity - critical for managing customer costs going forward - was significantly enhanced.” But that has not protected Binz from vocal criticism such as this WSJ editorial, which is unusual for FERC appointments.

The confirmation battle, if it turns into one, will start in September with the Senate Energy and Natural Resources Committee, where members are pulled in opposite directions by party ties and home-state industries.

Though not typically a political lightning rod, FERC is responsible for many decisions regarding the electrical grid, interstate gas pipelines and other elements of the U.S. energy system, with broad implications for advanced energy. With the Binz confirmation putting FERC in the spotlight, it is worth taking a look at current proceedings.

In January, FERC issued a Notice of Proposed Rulemaking to revise its interconnection agreements and procedures for small generators, an element of its Order 2006. This reform is geared at streamlining processing of small generator interconnection requests, spurred by market gains in distributed electricity generation. Most notably, the system cap for Fast Track eligibility would increase from 2 to 5 megawatts, with the potential to double the amount of qualifying solar projects.

In transmission, implementation is ongoing for FERC Order 1000, which requires states to coordinate on electric transmission planning and meet cost obligations for new transmission capacity. This stands to increase competition and require transmission providers to participate in regional planning processes, addressing barriers to bringing large wind power installations online.  A FERC presentation outlines the main sections of the rule, including requirements for Planning, Cost Allocation and Non-Incumbent Developers, as well as an overview of compliance. The commission says it has planned three webinars in the early fall to aid compliance, focusing on both regions with regulated power pricing and those with open power markets regulated by regional transmission organizations.

A more recent rule, published July 18, involves increasing competition and transparency in the ancillary services market. FERC Order 784 could be a boost for grid-scale energy storage providers, pitting fast-responding battery and flywheel storage technologies against slower gas- or coal-fired units for frequency regulation. It also expands so-called “pay-for-performance” requirements from an earlier Order 755 to ensure that speed and accuracy - strong-points of storage providers - are accounted for when utilities purchase transmission regulation service. Order 784 is in the earliest stages of implementation, and won’t actually become active until 120 days after its publication in the Federal Register.

Agency News

On Tuesday, Energy Secretary Ernest Moniz announced that DOE might revive the Advanced Technology Vehicle Manufacturing Program, an auto loan program intended to spur production of fuel-efficient vehicles. The program, which hasn’t made a loan since March 2011, financed established automakers looking to retool existing production as well as startup firms. While it is not actively considering the more than 100 loan applications received before the program stalled, DOE has a new executive director of its loans program office, Peter Davison, and has considered revising lending criteria and seeking a new round of loan requests.  

Moniz also delivered his first major policy address Monday before an audience at Columbia University in New York. The Secretary highlighted great strides in four technology areas: wind, solar, LED lighting and electric vehicles.

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Topics: Federal Policy Update


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