Rich Glick, in his first wide-ranging interview since denied a second term at the Federal Energy Regulatory Commission by Senator Joe Manchin of West Virginia, discusses the need for building out the transmission grid and for reforms to wholesale power markets to better accommodate the evolving resource mix toward more renewable, intermittent resources. Competitive wholesale power market reforms also are needed to address increasing climate-induced stresses on reliability, the former FERC chairman said.
"I think that some of the markets around the country, the markets operated by the RTOs and ISOs around the country, certainly need to be reformed in a way to address the change in the resource mix that we are seeing, the different challenges that we see associated with those changes, and just, again, extreme weather," Glick said.
Glick appeared to indicate surprise that FERC's proposed "relatively minor change" to federal right of first refusal, or ROFR, provisions in a closely watched transmission rulemaking engendered such opposition. "There was a lot of attention paid to that provision. But I think it underscored in many ways – hid the bigger problem that I think Order 1000 left, which is guiding or directing utilities towards (building) the wrong types of transmission in order to avoid the competitive bidding process."
However his former colleagues at FERC resolve the ROFR issue, he said the "concept behind competition, including in transmission, is a good one and I think will prove valuable to consumers."
Asked if the 1935 Federal Power Act provides the best platform for the transition to a 21st century clean-energy grid and economy, Glick said the nearly century-old law could stand to be revisited by Congress. When Congress acted in 1935 the line between state and federal jurisdiction was "pretty clear," he said. "But over time, the line has gotten much more blurry," in large part because of the advent of distributed generation and demand response, "which FERC has acted to encourage over the last decade or so. And that's caused some friction between the state regulators and between FERC." But given politics he suggested any changes to the 87-year-old law are unlikely.
Glick, who as an adviser to the late Sen. Dale Bumpers, D-Ark., in the 1990s wrote proposed legislation to require electricity competition at retail nationally, also doesn't see much prospect politically for improving the abysmal state of electricity competition for retail consumers outside of Texas. "Competition can be helpful but it's an idea I don't – I wouldn't say its time has come and gone, but it's an idea that certainly is not – there's not a lot of focus on that in most states around the country these days."
The retail competition bill he drafted for Bumpers also would have required competitive regional wholesale power markets throughout the country. Asked if FERC should use its authority to require RTO or ISO markets everywhere, he noted that the West and Southeast are the only remaining areas without some form of an organized regional market. Interested parties in the West are increasingly coalescing around the establishment of enhanced market regionalization, Glick said, noting the region's increasing acceptance of market regionalization is being driven by the need to better integrate the region's vast and far-flung renewable energy resources and respond to climate change. However, he held out little prospect for improving grid regionalization in the Southeast.
"I think FERC arguably has the authority, but I think it's – I'm not entirely sure the commission is going to be anytime soon focused on the Southeast. So I think it's better at this point to focus efforts to encourage greater regional efforts including RTO development in the West, where there's there seems to be some momentum fo
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