Advanced Energy Perspectives

On September 18, the Federal Energy Regulatory Commission (FERC) issued Order No. 2222, a long-awaited order setting the stage for aggregations of distributed energy resources (DERs) to participate on a level playing field in the wholesale markets operated by Regional Transmission Organizations and Independent System Operators (RTOs/ISOs). Adoption of these small, flexible, customer-sited resources has proliferated across the United States, primarily driven by customer demand, technology improvement, and falling prices. However, DERs have been largely left out of U.S. wholesale power markets. FERC’s order embraces these market trends and directs RTOs/ISOs to remove market barriers and allow aggregated DERs to compete. That opens the door for new revenue streams for DER owners, new business models for DER aggregators, and new flexibility for the grid. But realizing this potential will depend on how RTOs/ISOs implement the order.

Every four years, Americans turn their eyes to Florida as a crucial swing state in presidential elections. Here at AEE, we also pay attention to the election cycle in the Sunshine State, but this year our eyes are on the state legislature. Two years ago, AEE met with gubernatorial contenders from both parties – including the eventual winner, Gov. Ron DeSantis – to tell them about the opportunity of advanced energy for Florida. This year, AEE spent the heat of a Florida summer holding virtual meetings between member companies and candidates running for the state legislature to show how advanced energy can create jobs for the Florida economy, bring consumers more options – whether for solar power or electric vehicles – and lower the cost of energy for businesses and households.

On October 7, AEE and its many partners will celebrate Energy Efficiency Day (#EEDay2020) and we invite you to join us. The goal of Energy Efficiency Day is to bring home the benefits of energy efficiency for companies as well as households. Energy efficiency is a powerful tool that helps businesses and consumers save money, protect the environment by reducing pollution, and stimulate the economy by driving investment and employing over 2 million people. But energy efficiency is now more important than ever, given changes in work, school, and lifestyle driven by the COVID-19 health crisis.

The decline of coal has been well documented over the last decade, as it has gone from the majority electricity resource in the United States to less than a third of current power generation. At the same time, there have been many policy attempts to stop the retirement of uneconomic coal. For the first two years of the Trump Administration, several attempts were made – including use of the now-famous Defense Production Act – to bail out coal plants across the country. And some state legislatures – most notably in Indiana – have tried to keep utilities from transitioning from coal to advanced energy solutions. Now, the practice of “self-scheduling” coal plants – i.e., running them even when they are not the cheapest resource available for customers – is emerging as a coal-protection mechanism, especially in the MISO and SPP markets. In the first half of 2020, several state commissions, including the Indiana Utility Regulatory Commission, have begun to more closely review whether utilities under their jurisdiction engage in this practice. In July, Advanced Energy Economy intervened in an Indiana proceeding to argue against Duke Energy Indiana’s self-scheduling practice and teamed up with Berkeley Research Group to show how advanced energy resources can replace these coal plants and save Indiana ratepayers hundreds of millions of dollars.  

TAEBA members hold a virtual meeting with Rep. Four Price, a candidate for re-election to the Texas House of Representatives, top left.

Texas is the national leader in energy. As the undisputed leader in wind generating capacity with an interconnection queue stacked with almost exclusively wind, solar, and energy storage, and with billions of market potential available for distributed energy resources such as solar, demand response, storage, and electric vehicles, advanced energy is poised to play a key role in accelerating economic recovery, building a more resilient Texas, fostering market competition, and lowering customer electricity bills. Next year, as in all odd-numbered years, the Texas Legislature will meet for 140 days starting on the second Tuesday in January to consider the state’s regular business. The Texas Advanced Energy Business Alliance (TAEBA) will be actively engaged in the legislative session, working to expand opportunities for advanced energy in 2021. But we recognize that policymakers need to learn more about the many benefits advanced energy can bring to Texas – and the best time to educate them is when they’re running for office.