Blog entry September 2010

Last week, the U.S. House of Representatives Select Committee on Energy Independence and Global Warming featured a discussion on the role of competition in helping to move the United States toward a clean energy economy.
 
Committee Chairman Ed Markey (D-MA), cited the virtues of competition, calling it a “positive force” for advancing clean energy and suggesting it “will be the reason solar energy becomes equitable with the grid system.” Markey’s comments helped highlight the role competition plays in fostering innovation. “The kind of innovation that has been driving down the cost of electricity…is available only in America,” said Markey. “Technology always triumphs.”
 

The COMPETE Coalition will sponsor a day-long conference October 5th to discuss the opportunities and challenges facing national electric vehicle deployment, grid modernization and how they tie into America’s Smart Grid future.
 
The free conference – Electric Vehicle Technology and Grid Modernization: How PHEVs and Smart Grid Come Together – takes place at the Phoenix Park Hotel in Washington, D.C., and is co-sponsored by the Center for Business and Regulation, College of Business and Management, University of Illinois-Springfield.
 

The Detroit News has endorsed the effort of state lawmakers to roll back Michigan’s cap on competition in an editorial urging that limits on competitive market access be lifted from 10 percent to 25 percent of a utility’s consumer demand. The bipartisan legislative proposal, introduced in both state legislative chambers in June, would revisit a 2008 law that bars the vast majority of Michigan’s consumer demand from choosing an alternative, competitively priced power supplier.
 

The New York Independent System Operator (NYISO) credited competitive markets with reducing air pollution by attracting investment in power plant efficiency and clean energy sources, according to a report in Restructuring Today and Platts Electric Power Daily.
 
Stephen Whitely, NYISO’s CEO, stated that competition has combined with carbon control programs like the Regional Greenhouse Gas Initiative (RGGI) to sharply lower emissions of sulfur dioxide, nitrogen oxides and carbon dioxide.

“Competition in wholesale electricity markets has stimulated investments in cleaner generation, increased the use of renewable resources – such as wind power – and encouraged operating changes to improve the overall efficiency of power plants,” said Whitely. 

Smart meter technology, considered a lynchpin to widespread smart grid success, has taken a major step forward with the conclusion of a Washington, D.C. pilot program. PowerCentsDC, a two-year program, tested how consumers reacted to a variety of time-of-use price signal and rate programs.
 

Multiple layers of regulatory oversight protect our nation’s competitive electricity markets from systemic risks such as those that led to the recent financial market crisis. Much of the nation’s electric industry has undergone restructuring to promote competition and consumer benefits, but regulation and oversight at the federal and state levels are as strong as, or stronger, than they have ever been.
 

A recent Philadelphia Inquirer article shows that New Jersey’s competitive market is creating economic benefits for all electricity consumers, as evidenced by the entry of three new major power suppliers into the market resulting in an exponential growth in the number of customers who have switched to power suppliers.
 
While switching among the state’s commercial and industrial (C&I) customers has become common in the state, switching rates among residential customers has skyrocketed in the last year. According to the article, approximately 213 residential customers had switched to discount suppliers in 2009, but that number now stands at more than 16,000 – and the figure has doubled since June.

A new report by the Center for American Progress (CAP) identifies the top 10 states for energy efficiency and credits market forces for stimulating innovation and investment. According to the report, Connecticut, California, Maryland, Massachusetts, Pennsylvania, New York, Texas, North Carolina, New Jersey, and Ohio are the nation’s top energy efficiency markets – all but North Carolina have competitive retail electricity markets.
 

The percentage of customers shopping for alternative energy suppliers has grown in six restructured markets, according to recently released data from state regulators highlighted in Restructuring Today.
 
These new numbers compiled from earlier this year, combined with continued growth in regions across the nation, are the latest evidence competition is working by delivering economic benefits and competitively priced electricity options to consumers.