NEM's 22nd Annual National Energy Restructuring Conference will be held April 10-12, 2019, at the Hyatt Regency Washington on Capitol Hill. You may register here.

The following state PUC Chairs and Commissioners will participate in the event: John Betkoski, III, Vice Chairman, CT PURA; Odogwu Linton, Commissioner, MDPSC; Upendra Chivukula, Commissioner, NJBPU; Norman Saari, Commissioner, MIPSC; Diane Burman, Commissioner, NYPSC (invited); Valerie Espinoza, Commissioner, NMPRC; Boyd Dunn, Commissioner, AZCC; Tim Echols, Vice Chairman, GAPSC; and John Rosales, Commissioner, ICC. Additional invitations to federal and state officials are outstanding.

A Draft Agenda is available here. Sponsorships are available. Please contact headquarters if you are interested in sponsorship.

Earlier this week the Senate Energy and Natural Resources Committee convened a hearing to examine the electricity sector in a changing climate. As Committee Chairman Murkowski noted, "Our nation’s energy mix has changed significantly over the past decade – largely driven by the shale revolution and the low cost of natural gas, but also federal and state policies that have boosted low or zero emission energy technologies. The electricity sector is just one piece of the puzzle when it comes to climate change, but it is also the most visible and all encompassing. Reliable electric power is central to our very way of life . . . But as more renewables come online and the mix of baseload power changes, our committee will focus on maintaining grid reliability and resiliency. We will prioritize keeping energy affordable. And we will also be working to advance cleaner energy technologies that can help reduce greenhouse gas emissions."

One of the witnesses at the hearing was former FERC Chairman Joseph Kelliher, who appeared on behalf of NextEra Energy (the parent of Florida Power & Light). Kelliher testified that,

"Lowering costs was a primary goal of competition policy in both the electricity and natural gas industries. Competition produced the shale gas revolution, successfully shifted risk away from customers to market participants, and facilitated deployment of new technologies.

In my view, wholesale competition policy has been a major success. The same cannot be said about retail competition. Retail competition has largely been limited to states that historically had very high retail rates, with the exception of Texas, where consumers are mandated to choose a competitive supplier. In many states, retail competition has been a failure, at least for residential customers, resulting in higher rates from competitive suppliers than the rates charged by regulated utilities. Perhaps because of these outcomes, participation by residential consumers in retail programs has been declining since 2014. The real beneficiary of these retail programs appears to have been industrial and other large customers.

There are some who argue the electric sector transition is the result of systemic “market failure” that must be corrected. It should be recognized that the “market failure” these critics are trying to remedy is low prices resulting from market fundamentals. Their “solution” is to raise prices charged by a select few, which would tend to suppress prices for everyone else, discouraging the entry of new, more efficient economic generation. In the end, these types of proposals are designed to shift risk away from generators back to customers, contrary to a primary goal of competition policy. In effect, subsidies grant the owners of uneconomic generation facilities a safe haven from the hazards of competitive markets."

Kelliher's comments are notable given the current electric choice ballot initiative being pursued in Florida. The current status of the ballot initiative is available here.

The full text of Kelliher's testimony is available here.