The Electric Power Retail Access Hard Core

Michael Giberson

Ken Silverstein has a column about restructured retail electric power markets up at EnergyBiz Insider. He’s collected a variety of viewpoints and generally provides an update on the current state of things. He saves the fun part until nearly the end, where he quote Andrea Morrison, regulatory affairs director of Strategic Energy:

With regard to the purchase of all goods and services we believe that customer choice is a fundamental right and that any abridgement of this right, even in emergency situations, is never to be taken lightly and should be remedied as soon as possible after the crisis has passed.

I believe she has out-libertarianed the Cato Institute on this issue. (But maybe that’s too easy to do; I think a couple of state PUC’s are more libertarian than Cato on electric restructuring.)


3 thoughts on “The Electric Power Retail Access Hard Core

  1. Markets perfect themselves, given the opportunity. Deregulation, were it ever really tried in retail electricity, might permit a market to develop and perfect itself. That remains to be demonstrated. Perfecting markets requires a “perfecter” who is smarter than the markets. The existence of that “perfecter” also remains to be demonstrated.

    Restructuring and re-regulation of retail and wholesale electricity, as practiced in the real world, has not been deregulation, or anything which could reasonably be accused of being deregulation. CA, in particular, piled on “must serve” requirements, a next day bidding scheme, a same day scheme, etc. Those “goodies”, combined with an ISO that did not understand its system as well as the suppliers and marketers, a shortage of hydroelectric availability, and retail price caps combined to create a fiasco.

    California is in the process of structuring yet another fiasco, triggered by very limited conventional capacity reserve margins, a fascination with intermittent “source of opportunity” generation and a failure to reassess the portion of hydroelectric capacity which is “reliable” as opposed to “source of opportunity” power. They came close last summer, when the air grew hot and still and wind availability dropped precipitously. Fortunately, hydro was available in sufficient quantities. This coming summer represents another opportunity.

  2. Markets perfect themselves, given the opportunity. Deregulation, were it ever really tried in retail electricity, might permit a market to develop and perfect itself. That remains to be demonstrated. Perfecting markets requires a “perfecter” who is smarter than the markets. The existence of that “perfecter” also remains to be demonstrated.

    Restructuring and re-regulation of retail and wholesale electricity, as practiced in the real world, has not been deregulation, or anything which could reasonably be accused of being deregulation. CA, in particular, piled on “must serve” requirements, a next day bidding scheme, a same day scheme, etc. Those “goodies”, combined with an ISO that did not understand its system as well as the suppliers and marketers, a shortage of hydroelectric availability, and retail price caps combined to create a fiasco.

    California is in the process of structuring yet another fiasco, triggered by very limited conventional capacity reserve margins, a fascination with intermittent “source of opportunity” generation and a failure to reassess the portion of hydroelectric capacity which is “reliable” as opposed to “source of opportunity” power. They came close last summer, when the air grew hot and still and wind availability dropped precipitously. Fortunately, hydro was available in sufficient quantities. This coming summer represents another opportunity.

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