Richard Glick, the only real Democrat on the Federal Power Regulatory Fee, has some ideas about what the company answerable for key federal vitality insurance policies is perhaps requested to perform underneath the incoming Biden administration. As the present FERC commissioner thought of most certainly to be named chairman as soon as Joe Biden is sworn in as president, these ideas are price understanding.
On Tuesday, Glick spent a half-hour sharing his views with Gregory Wetstone, CEO of the American Council on Renewable Power, as a part of the commerce group’s digital Grid Discussion board occasion. Whereas he declined to remark particularly on issues earlier than FERC, Glick did clarify that he’s sad with some key selections imposed by his Republican colleagues on the interstate vitality market operators underneath FERC jurisdiction.
Glick’s perspective on FERC’s orders concerning the capability markets run by mid-Atlantic grid operator PJM and New York state grid operator NYISO gained’t shock those that’ve learn his harsh critiques of what he views as their unlawful and poorly thought-out imposition of federal limitations on state-subsidized clear vitality assets.
However Glick, the previous authorities affairs director for Avangrid Renewables and Iberdrola and common counsel for the Democrats on the Senate Power and Pure Sources Committee, has additionally joined with Republican and former FERC Chairman Neil Chatterjee on another selections.
These embody FERC Order 2222, which requires the nation’s impartial system operators and regional transmission organizations to open their markets to distributed vitality assets, in addition to FERC’s coverage assertion expressing openness to contemplating ISO and RTO carbon-pricing proposals.
Chatterjee has imagined to information shops that his help for these initiatives led to the Trump administration changing him as FERC chairman with the extra conservative James Danly earlier this month. Whereas Glick stated he’d learn these stories, he declined to invest on their accuracy.
Nor did he single out Danly’s current selections to cancel a FERC occasion to assemble info on electric-vehicle-to-grid integration or to name off month-to-month press briefings which were conventional for many years for explicit criticism.
And whereas Glick identified that “it seems that Chairman Danly will solely be chairman for a few months,” he didn’t assume that he could be named to interchange him. “It’s as much as the brand new president to resolve who leads the fee.”
However as the one Democrat sitting with two Republicans, and the Democratic and Republican nominees to fill the commissions’ two open seats nonetheless awaiting U.S Senate affirmation hearings that aren’t sure to conclude in a well timed trend, business watchers count on that Glick will certainly be Biden’s selection.
That gained’t change the steadiness of votes for or towards sure insurance policies — “we have now to get a majority of the commissioners to go alongside,” he stated. However it might enable Glick to set FERC’s agenda on essential issues starting from wholesale vitality market operations to interregional transmission insurance policies.
FERC’s orders on PJM and NYISO capability markets have to be revisited
“I can’t discuss pending instances,” Glick stated. “However I feel the fee has carried out a disservice to state clear vitality packages by adopting a MOPR-type program, basically elevating the prices of technology that’s backed not directly by states centered on clear vitality.”
MOPR stands for “minimal supply worth rule,” a regulatory assemble that FERC’s Republican majority has used to order PJM to drive state-subsidized assets to make use of administratively set minimal costs when bidding into its roughly $10-billion-per-year capability market. The same idea has knowledgeable FERC’s selections to disclaim NYISO’s proposals to exempt state-preferred renewables and vitality storage assets from buyer-side mitigation guidelines.
Past suspending PJM’s capability auctions for the previous two years, FERC’s MOPR orders might stop some clear vitality assets from clearing the market, driving up capability costs to the good thing about fossil-fuel-fired energy crops, and exposing prospects throughout its 11 states to billions of per yr in extra prices within the subsequent decade. That chance has led states together with Illinois, New Jersey and Maryland to contemplate taking steps to depart PJM’s capability market.
Glick famous that authorized challenges to FERC’s PJM order might nicely result in courts agreeing along with his view that “I don’t assume it’s authorized” for FERC to impose its authority over state vitality policymaking on this approach. If courts made that call, he stated, “I feel it might be the duty of the fee to remodel these orders.”
However even when that doesn’t occur, “I feel it’s dangerous regulatory coverage, within the sense that it’s going to elevate costs unnecessarily, but additionally block states from what I feel is their authentic function to not solely select their very own useful resource combine however [also] set targets on carbon discount.”
FERC has the authority to unblock transmission and deal with grid reliability
Glick added that it’s extremely unlikely that the Biden administration will be capable to meet its aggressive decarbonization targets “except we are able to entry important quantities of newly constructed renewable assets,” which will not be doable “except we considerably construct out the grid.” However U.S. transmission build-out has been languishing over the previous 5 years and stays far behind what a number of analyses say is required to combine far-off wind and solar energy.
To repair that, Glick says FERC ought to use its authority underneath Order 1000, created in 2011, to set new floor guidelines for the way prices are allotted for transmission initiatives constructed between completely different ISOs and RTOs. As we’ve famous in earlier protection, Order 1000 has but to drive breakthroughs within the regulatory and authorized bottlenecks which have largely stymied interregional transmission initiatives, and clear vitality teams have been asking FERC to take stronger steps to permit them to maneuver ahead.
FERC has additionally ordered ISOs and RTOs to assess the resilience of their transmission networks amid a quickly altering useful resource combine. California’s rolling blackouts and grid emergencies this summer time, pushed by regionwide warmth waves, spotlight the impacts of local weather change on vitality safety, Glick stated.
“There are actually useful resource adequacy points all through the West,” he stated. “In my estimation, we have to take useful resource adequacy extra severely.”
“That doesn’t imply that you have to impose necessary capability markets like we have now within the East,” which the U.S. West lacks, he cautioned. However it does imply that “we have to determine a technique to adequately compensate assets for the worth they supply the grid,” in Glick’s view.
That can seemingly embody vitality storage techniques enjoying into the wholesale market buildings being created underneath the FERC Order 841 mandate, he famous. “That worth could also be flexibility, via ancillary providers markets, or some sort of modified capability market or flexibility market,” he stated. “I feel storage goes to play an enormous function in that.”