Last month, the Federal Energy Regulatory Commission (“FERC”) announced it would seek rehearing of a recent US Court of Appeals decision, which changes how demand response providers are compensated in wholesale energy markets. The court’s decision was a setback for demand response, a clean energy resource used by utilities and electric grid operators that pays people to conserve energy during periods of peak or high demand.
Demand response balances stress on the electric grid by reducing demand for electricity, rather than increasing supply. This makes our grid more efficient, reduces harmful air emissions from fossil fuel plants, and keeps electricity prices lower. The court decision is significant because it invalidates FERC Order 745. This Order required that demand response be fairly valued in the wholesale energy market, allowing it to compete on a level playing field with more traditional electricity resources, like coal and natural gas. Read More