APPA actively participates in FERC dockets, conducts studies, and advocates for reforms to the centralized power supply markets operated by Regional Transmission Organizations (RTOs). In recent years, these efforts have focused on the mandatory capacity markets.
New Generation Capacity in 2015: Is the Increase in Merchant Generation Capacity a Positive Development? Public Power Chat (February 2017)
“Missing Money” Revisited: Evolution of PJM’s RPM Capacity Construct, by Jim Wilson. This paper discusses the evolution of PJM Interconnection, LLC’s Reliability Pricing Model (“RPM”) resource adequacy mechanism and recommends a path to transitioning to a maximally voluntary approach to resource adequacy. (September 2016)
Response to The Brattle Group’s Open Letter to the U.S. Government Accountability Office on Electricity Capacity Markets. On May 5, 2016, four representatives of The Brattle Group (“Brattle”) sent a letter to the U.S. Government Accountability Office (GAO) responding to questions posed to the GAO by Senate Energy & Natural Resources Committee Chair Lisa Murkowski (R-AK) and Ranking Member Maria Cantwell (D-WA) regarding U.S. electricity capacity markets. APPA in this document responds to many of the statements made by The Brattle Group in their letter.
2015 Retail Electric Rates in Regulated and Deregulated States
Energy Information Administration data shows that between 1997 and 2015, retail electric price increases were higher in states with deregulated electric markets than in regulated states. Although the rate disparity had narrowed somewhat between 2010 and 2012, the disparity has been increasing since 2012. The retail choice experience — combined with the divestiture of utility generating assets, and the exposure of retail consumers to wholesale rates set in RTO markets — has resulted in an increasing gap. This report presents average retail rates for regulated and deregulated states in each RTO market region.
PJM’s “Capacity Performance” Tariff Changes: Estimated Impact on the Cost of Capacity, by James F. Wilson of Wilson Energy Economics, estimates the cost impact on consumers of PJM’s recent Capacity Performance (CP) package of changes to its Reliability Pricing Model (RPM) capacity construct to be $7.3 billion over the course of the 2016/17, 2017/18, and 2018/19 delivery years, with likely further impact in later years.
House Energy and Power Subcommittee Testimony
APPA President and CEO Sue Kelly testified June 4, 2015, at a U.S. House Energy and Commerce Subcommittee on Energy and Power Committee hearing on a discussion draft of energy legislation. The testimony presents APPA’s views of the RTO-operated wholesale electricity markets, as well as FERC’s enforcement efforts in those markets.
In a May 2015 letter to members of Congress, representatives of electricity consumers in the PJM region caution that PJM’s Capacity Performance Proposal will increase costs to consumers.
Watch a video explaining the deregulation of wholesale electricity markets.
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Senate Energy and Natural Resources Committee Testimony
APPA President and CEO Sue Kelly testified May 19, 2015, at a U.S. Senate Energy and Natural Resources Committee hearing on proposed bipartisan energy supply legislation. She shared APPA’s views on how to improve Americans’ access to affordable, reliable and environmentally responsible electricity.
Power Plants Are Not Built on Spec: 2014 Update. This analysis of new electricity generation constructed in 2013 finds that almost all of the new power plants studied were built under long-term contracts or utility ownership, and not for sales into the wholesale power markets (October 2014)
Electricity Markets Not Ready to Fight Climate Change, Public Power Chat (May 19, 2014)
Look at reforming RTO-run capacity markets as part of Quadrennial Energy Review, APPA urges DOE. Public Power Daily (April 22, 2014)
APPA Statement for the Quadrennial Energy Review (QER) New England Public Meeting. APPA’s statement for the Department of Energy (DOE) QER meeting on infrastructure constraints in New England urges DOE to recognize the role of the wholesale electricity market structure in its examination of regional infrastructure concerns in New England and elsewhere (April 2014)
Group Letter to FERC on Capacity Markets. This letter, signed by a diverse group of thirty organizations, outlines core principles for the centralized capacity markets and requests that FERC take further actions to ensure that such principles are honored in RTO capacity procurement mechanisms. February 2014.
APPA Post-Technical Conference Comments on Centralized Capacity Markets. These comments follow up on FERC’s September 25, 2013 technical conference on centralized capacity markets operated by RTOs and describe APPA’s primary concerns and recommendations for reforms to these markets. January 2014.
Responding to Prof. Hogan, by Elise Caplan. A response to the economist Paul Hogan’s assertions about the benefits of RTO markets. Published in Public Utilities Fortnightly, February 2013.
Have Restructured Wholesale Electricity Markets Benefitted Consumers? presents the primary evidence of the adverse impacts of restructured wholesale electricity markets on consumers. Co-authored by Elise Caplan, APPA and Stephen Brobeck, Consumer Federation of America, and published in ElectricityPolicy.com. (December 2012)
APPA Response to the Compete Coalition’s White Paper on the Benefits of RTO Markets. This paper identifies the fallacies behind Compete’s claims about the benefits of RTO markets. (November 2012)
Critique of the NREL/Plexos Analysis of the Proposed Energy Imbalance Market (EIM) in the Western Interconnection by Dr. Kenneth Rose. This review identifies numerous flaws in the methodology used by the National Renewable Energy Laboratory (NREL) in its draft report on the benefits of an EIM. APPA and the National Rural Electric Cooperative Association (NRECA) submitted to Comments to NREL on the EIM benefits analysis. (November 2012)
Competitive Market Plan for Reform of RTO-Run Wholesale Electricity Markets: 2011 Update. APPA has released a new version of its proposal for reforming the RTO-operated wholesale electricity markets that addresses the many critical developments in these markets over the past two years. Read the full Plan or the Preface.
Read archived investigative studies of the restructured RTO-operated wholesale electricity markets.