The Energy Markets Podcast

Few in the electric industry can boast Alison Silverstein's achievements in contributing to pro-consumer, pro-competitive reforms at both the state and federal levels. And there is perhaps no one better situated to discuss the causes and ramifications of last year's deadly weather-induced grid outage in Texas last year. Perhaps most intriguing, however, is Silverstein's call for building on the indisputable gains from pro-competitive reforms in electricity to ensure competitive markets build in social policies to protect those most at risk from the avalanching impacts of climate change we are experiencing already from a warming planet."The problem is that today we have not adjusted regulation or found the right balance - certainly here in Texas, arguably in California and other places - between what can we trust competition to do effectively and where do we need mandates and affirmative social policy to step in. Markets are wonderful at saving money and promoting efficiency," Silverstein says. "They need to be better at reliability. They certainly are terrible at equity. But we have significant reliability challenges that have to be handled with much more sophisticated analysis and mandatory rules that we haven't put in place. And we need much better changes in how we handle equity as a society, rather than waiting for markets to do that. So, we should be using competition for what it's good at and using social policy for what it's good at instead of trying to make the market do it all." Support the show

Economist and renewables-enabling transmission policy influencer Rob Gramlich gives high marks to the past year's efforts by the Biden Administration and the Federal Energy Regulatory Commission in terms of moving the needle on policy restraints that have for years stymied development of necessary electricity transmission infrastructure nationally. The Infrastructure Investment and Jobs Act (IIJA), the massive infrastructure bill that Congress approved on a bipartisan basis, contains significant provisions that buttress FERC's transmission siting authority while funding development of new and much-needed reliability-enhancing transmission infrastructure and technology. Meanwhile, the Department of Energy has moved quickly to build on that new authority, launching the Build a Better Grid Initiative in an effort to jumpstart the transmission-enhancement provisions of the bipartisan infrastructure bill. Gramlich also details provisions in the Build Back Better bill, now stalled in Congress, that would further the country's efforts to enhance the power grid and drive clean energy development in response to the climate change emergency.Support the show

Dan Dolan of the New England Power Generators Association explains his members' concerns with subsidized resources in the region's wholesale power market, and the recent ballot initiative in Maine affecting a 145-mile, $1 billion transmission line designed to bring subsidized Canadian hydropower to Massachusetts. The market overseen by ISO-New England has resulted in cost savings for consumers and dramatic reductions in emissions, including greenhouse gases that contribute to climate change, Dolan says. A big missing piece of the equation, Dolan explains, is an economy wide carbon price that would even more rapidly drive the region to a clean-energy grid, and more effectively promote EVs and other measures needed as part of a comprehensive solution to the climate emergency.Support the show

The Electric Power Association's Todd Snitchler discusses the challenges facing traditional merchant power generators in the transition to a clean energy grid, calling for an economywide price on carbon as part of the  grid transformation required to meet the climate change threat. Studies show relatively small price on carbon can achieve a "dramatic reduction" in harmful emissions, EPSA's president and CEO says, noting that in regions with competitive markets, consumers will get "more bang for their buck" from a carbon price than from state subsidies. Snitchler addresses the problem of state-subsidized power resources in federally regulated regional wholesale power markets. Those subsidies distort price signals and jeopardize the flexible capacity resources needed to assure grid reliability, a chore that will only become more complicated with increased market penetration by intermittent, renewable resources. The more than 20-year history of the merchant power sector has shown that competitively sourced wholesale electric power has  lowered electricity prices, reduced harmful emissions including greenhouse gases, and promoted innovation that has improved the grid and system reliability. Support the show

University of Colorado economist Lynne Kiesling, recently appointed to DOE's electricity advisory panel, discusses the need for policy makers to promote technology innovation as part of efforts to decarbonize the grid in response to climate change.Support the show

Denis George, Manager, Legal and Energy, for Kroger stores, speaks to the different regulatory environments the company must navigate in the 42 states in which it operates more than 3,000 stores. The states that allow customer choice allow the company to operate more flexibly, to more easily meet Kroger's climate-change goals, and to realize cost-savings that it can pass on to its customers.Support the show

Jeff Dennis, managing director and general counsel for the Advance Energy Economy and Advanced Energy Buyers group, discusses the need for organized competitive wholesale power markets across the country as a pre-requisite for meeting the Biden administration's goal of a zero-carbon grid by 2035. The organization that includes leading information technology giants like Google, Microsoft and Facebook also supports smart government spending in support of private investment to build out the transmission grid that will be needed to access low-cost, abundant renewable energy resources in remote areas. However, Dennis does not believe there is the political will to reform state-level retail markets in line with the Texas retail power model supported by many podcast speakers.Support the show

Mark Brownstein of the Environmental Defense Fund says a clean energy standard combined with a clear market-based structure at wholesale regionally offers the best and least-cost approach to attaining a zero-carbon electricity grid by 2035, as called for by President Biden. Having a strong national policy that sets standards for carbon and environmental performance is an essential framework, and will be achieved most efficiently and at least cost to consumers when combined with wholesale energy market structures, Brownstein says.Support the show

Frank Lacey,  president and founder of Electric Advisors Consulting, explains how retail electricity competition in the dozen of so states outside of Texas is failing consumers, the economy and the environment. Lacey also explains how static comparisons of monopoly utility electricity prices with those offered by competitive suppliers, as is in vogue among some state officials to argue against competitive electricity supply for residential consumers, is fundamentally misleading. We also talk about Who's the Buyer?, a paper Lacey co-wrote last year with Rob Gramlich, founder and president of Grid Strategies. The paper on behalf of the Wind Solar Alliance details how keeping utilities involved in supplying electricity in competitive retail markets is serving as a disincentive for the adoption of renewable energy and other innovative technologies we will need to meet the Biden administration's goal of a zero-emissions grid by 2035.Support the show

Veteran energy lawyer and regulator Jim Cawley discusses his experience as a utility regulator in Pennsylvania, first under the old regulated utility monopoly model and then again later, after the state restructured its retail electricity market to promote competition. He talks about how the state's market-based approach to utility regulation has saved consumers countless dollars and helped promote cleaner generation resources. Nevertheless, he recently wrote an op-ed published on PennLive.com, the Harrisburg Patriot-News website, calling for Pennsylvania policy makers to adopt the Texas model for a restructured retail electricity market, in which the utility is relegated to its core distribution and transmission businesses and largely quarantined from providing electricity to customers. He insists such reform is a prerequisite if we are to successfully transition to a zero-carbon electricity grid by 2035, as called for by the Biden administration. Support the show