Energy Choice

Clean Energy (Mostly) Survives Texas Legislature

Clean Energy (Mostly) Survives Texas Legislature

The Texas Legislature doubled down on subsidizing fossil energy at the end of its regular session and raised costs on wind and solar energy, but rejected worse attacks on the state’s booming clean energy sector.

The Legislature approved SB 2627 and SJR 93 which provide $7.2 billion in low-interest loans for the development of up to 10,000 megawatts of new methane gas power plants. Members also passed HB 5, which makes gas power plants eligible for tax breaks while revoking eligibility for renewable energy projects and battery storage for similar tax breaks. 

However, the Legislature rejected stricter rules for permitting of wind and solar projects, and a proposal that would have made renewable energy producers pay more for ancillary services costs. It also rejected HB 2288, which would have prohibited the sale of distributed energy resources on ERCOT’s wholesale market. The Legislature did approve HB 1500, which requires certain renewable projects to pay higher transmission fees and require all renewable energy projects to have backup generation capacity. Legislators mostly ignored efforts to address the demand side of the resiliency / reliability issue.

Another Study Shows the Value of Competitive Markets

While we previously reviewed this report, we thought it worth revisiting while Congress argues about how to subsidize what is already happening in areas with competitive markets. Keep in mind that if the current Clean Energy Payment Plan (CEPP) goes down, which is likely, that a better alternative already exists. Namely, removing obsolete regulatory barriers to market entry for independent generators and service companies. Consumers are already demanding clean energy where the market allows them to choose and there are plenty of innovative private-sector companies ready to meet that demand.

National Clean Energy Week Speakers Provide Hope for Passing the American Energy Innovation Act

Last week, dozens of elected officials, policymakers, and energy industry experts convened online for the fourth annual National Clean Energy Week (NCEW). This is always a great event, and if you missed it, recordings of the sessions are available on-demand. But this year it was particularly important for the insight its speakers provided on the American Energy Innovation Act (AEIA), the most sweeping national energy policy update in more than 12 years.

The Development of ‘Virtual Power Plants’ is Strengthening Electric Grids and Empowering Consumers

Virtual Power PlantSource: Yale Environment 360

Virtual Power Plant

Source: Yale Environment 360

The traditional concept of a “power plant” is getting a makeover as the world pushes to decarbonize and increasingly integrate new resources and technologies in its energy grid.

Since the dawn of electricity in the early 20th century, our energy supply has been heavily centralized; power was generated in a single facility, such as a coal-fired plant, and then transmitted over a network of wires and poles to homes and businesses.

Now, electric grids are increasingly decentralizing, giving rise to cloud-based systems that pool resources to meet fluctuating consumer demand.

Virtual Power Plants (VPPs) are networks of distributed energy resources (DERs) such as solar power plants, power grids, wind farms, rooftop solar systems, and storage batteries, which are harnessed as a collective energy source. VPPs, through a central control space and distributed energy resource management systems (DERMs), distribute and exchange power generated by individual units, depending on periods of peak load.

VPPs and DERs are providing clean energy at reduced costs, providing greater consumer access to renewable power. As heating and cooling are becoming more and more electrified, and climate change produces extreme temperatures and weather events, precise forecasting of local production and consumption of energy is becoming increasingly important for its dependability and flexibility. In addition to strengthening grid resilience and reliability, consumers are empowered.

 “The DER is primarily being driven by individual commercial, industrial, and residential customers rather than the utilities, regulators or policymakers,” said Gene Wolf, a fellow of the Institute of Electrical and Electronics Engineers.

In other words, individuals have more control, and customers are even able to sell electrical output back to the grid.

“A large variety of resources can be incorporated into a virtual power plant (VPP). The interconnected units can then be dispatched using special software and traded intelligently on the energy market,” explained Sleman Saliba, a global product manager with ABB Energy Industries. “The goal of a VPP operator is to run the pool of units optimally and generate maximum revenues for its participants by bidding smartly on the energy trading market.”

As the availability and affordability of solar panels, storage systems, and other flexible resources increases, so too does the potential of VPPs and DERs. In fact, DERMS technology global revenue is predicted to increase between now and 2029 from $800 million (currently) to almost $6 billion, and Wood Mackenzie predicts DER capacity reaching 387 GW by 2025. Another report, from Navigant, foresees capacity reaching over 500 GW by 2028. Even in the midst of the debate over whether the control of DERMs will fall to utilities or third-party aggregators, more of those utilities are investing in VPP and DER technology and starting to pursue the VPP model. 

It seems that VPPs will disrupt energy marketplaces in ways that not only benefit consumers and their wallets, but also help policymakers meet the challenges of climate chan

New Renewables Lobbying Group Comes to Washington

In a letter released to its members this morning, The American Wind Energy Association (AWEA) announced its intention to make renewables “the dominant power source in America.”

AWEA will be joining forces with the likes of NextEra Energy Inc., Avangrid Inc., and Berkshire Hathaway Energy to create a new lobbying group called the American Clean Power Association. No matter the outcome of the November election (although they are preparing for both possibilities), renewable energy groups such as the American Clean Power Association are planning major policy pushes for the next presidential administration.

As we have previously mentioned, the coronavirus pandemic and the associated economic shutdowns have wreaked havoc on an otherwise booming industry. Just today, Bloomberg reported that wind and solar made up the majority of Earth’s new power generation for the first time in 2019. While promises of renewable energy becoming as cheap and reliable as oil and gas are nothing new, we were on the precipice of that dream becoming a reality until the pandemic struck.

While our friends at the Solar Energy Industries Association are not joining, they are planning on working with the new group on key policy areas.

As we all know well, more options for power generation are better for consumers and producers alike. We at ECC are excited to see what the future will bring.

In Northeastern States, Energy Choice Under Attack as Electricity Retailers Get Restricted

In Northeastern States, Energy Choice Under Attack as Electricity Retailers Get Restricted

Much of the attention in the realm of energy choice recently has been in the southern United States, with the Energy Freedom Act in the Carolinas, the Florida Supreme Court striking down the energy choice ballot initiative, and the Virginia Energy Reform Act. But as 2020 comes into full swing it has become clear that the Northeast is an integral battleground.

In the past, northeastern states have been great examples of the benefits of energy choice and the successful implementation of such programs. But those who want to restrict energy choice are fighting in these states to take away the freedom of energy choice.