Another important market dimension to consider for wholesale electricity is the Federal Energy Regulatory Commission (FERC). Utility Dive lays out some talking points on regulatory efforts for a greener grid. More specifically, the roles that Attorney Generals and FERC plays in regulation, which in turn will pave the way for the future wholesale electricity market, is a key facet to keep in mind.
This is apparent by just how polarizing clean energy technology initiatives are becoming. Many in favor of gas and coal are vehemently opposed to aggressive implementation of green technology because they argue it will undermine our fuel security. They also state that alternative energy sources are not being accurately valued because of just how many credits, incentives, and various valuations are skewing their real worth.
What this debate and subsequent shimmy for market valuation change means for wholesale electricity is that things might only get more complicated from here on out. Especially as regulators both give priority to clean energy and try to keep things as fair and free in the market.
The Need for a New Model?
The majority of the country is competitive when it comes to electricity. This is especially true in Texas, where about 85% of consumers have the freedom to choose their provider. But Science Daily (via Cornell University) points out that restructured market models were originally designed to fit the more traditional energy mold: natural gas, coal, and other fossil fuels for electrical generation. What this means is that the market model might need to be tweaked to further welcome in alternative energy sources. Either that or the market will correct itself naturally, but many think there needs to be bumpers in place in order to further integrate green efforts for the grid.
Science Daily, in the same source, shares that electricity is too complex to be completely free – as perhaps all markets are – and in that respect, small administrative changes should be implemented in order to make the market more conducive for renewables. As mentioned above, there are a lot of challenges to those types of changes, but all of which could have wide scale implications on the wholesale electricity market.
On a similar note, in this article on the need for Congress to step in, the author Tom Hassenboehler states that Congress should step in, along with the FERC, and make sure electricity markets are more open and able to flourish in their competitive state. This sort of regulation will ensure transparency and would be a larger model of what the majority of Texas has adopted since 2002.