The U.S. economy is wonderfully dynamic. New businesses launch daily, creating jobs and providing tax revenues for schools and police. Innovative technologies are introduced, offering customers more choice and improved services. Sometimes, of course, those new firms and devices replace existing institutions and products.
Today’s electricity industry is no exception. Technological advances are helping hundreds of new businesses deploy wind turbines and solar panels, build new natural-gas generators, and install monitors and controls that increase the efficiency of buildings and factories. At the same time, uneconomic and often dirty power plants are closing – within the past few years more than 10,000 megawatts of electric capacity in Ohio alone have closed or been announced to close.
Such closures can be good for customers, since they enjoy lower costs from the modern technologies. Closures can also be good for public health and the environment, since old units no longer spew mercury, carbon dioxide, and other harmful pollutants into the air.
Plant closures, however, also impact energy workers and their local communities. As the country’s energy system transitions from coal to cleaner ways of making electricity, companies and policymakers should support and provide resources for those most affected – so everyone may benefit from the clean energy economy.
As a utility executive, it is the best of times, it is the worst of times. It is the age of innovation, it is the age of stagnant tradition. With a nod to Charles Dickens, it is the epoch of environmental improvement, it is the epoch of continued pollution.
Perhaps no state better represents those extremes than Illinois, where Commonwealth Edison (ComEd) in the north is considering new business models and embracing greenhouse-gas reductions, while Ameren in the south is rejecting change and virtually anything related to clean energy.
We all know exercise is good for our hearts and bodies, and who doesn’t enjoy stepping on the scale after weeks of good workouts to confirm progress was made?
In a way, power companies are just like people.
As they begin to invest in smart meters and other grid modernization efforts, utilities want to know how well they do. Can they measure success and prove to investors and regulators they’re making smart decisions?
To that effect, Illinois’ largest electricity provider, Commonwealth Edison, is the first in the country to adopt a new tool that calculates clean air benefits from investments such as advanced meters.
Beyond bringing tangible rewards to ComEd, this little-noticed milestone can have major implications for the entire power industry.
My head feels whipsawed by the wildly changing proposals to bail out FirstEnergy’s uneconomic and dirty power plants. The latest development in this ongoing saga occurred June 29, when the Public Utilities Commission of Ohio (PUCO) staff recommended a new subsidy solution for the utility behemoth: $131 million per year over three years.
While this proposal is, blessedly, 90 percent less than FirstEnergy’s original $4 billion bailout proposal, it’s still an unnecessary subsidy that Ohio taxpayers should not be forced to shoulder. Hearings on whether the PUCO commissioners should approve the deal begin today.
It’s not usually a good idea to dis federal regulators. FirstEnergy doesn’t seem to care.
Almost two months ago, the Federal Energy Regulatory Commission (FERC) ruled against the Ohio-based utility giant’s request to bail out its uneconomic power plants. FirstEnergy then tweaked its proposal to obtain the same result but, according to its CEO, “without the need for…FERC approval.”
To “FERC-proof” its bailout scheme, FirstEnergy now tries to mockingly call its subsidy a “surcharge” rather than a “power purchase agreement (PPA).” Put another way, by simply changing the wording of the original bailout, the utility’s sleight of hand aims to skirt federal oversight.
Environmental Defense Fund (EDF) is joining the Electric Power Supply Association (EPSA) and others in asking FERC to overturn this end-run attempt – something we’re calling FirstEnergy’s “Virtual PPA.” It’s virtually the same as the original rotten deal, and it’s just as bad for customers, clean air, and markets. Read More
At least in theory, government officials are supposed to monitor electric utilities and ensure they do not abuse their monopoly power. For more than a century, these independent regulators have protected customers from unfair, above-market prices and provided a check on giant corporations.
That social contract is being tested in Ohio.
In an unprecedented move, the Public Utilities Commission of Ohio (PUCO) today allowed FirstEnergy to seek a new power plant bailout – a full day before opponents were to offer their objections. So, without listening to the arguments against the deal, the PUCO rubberstamped the utility’s request for a rehearing.
Unfortunately, this is not the PUCO’s first rubber-stamping. FirstEnergy’s original proposal would have forced customers to pay $4 billion to subsidize the utility’s old and dirty power plants, which could no longer compete in the market. That proposal was almost laughable since the power plants were not needed, and certainly not at such a high price – other companies proposed to offer the same amount of electricity at significantly lower prices. Read More