Driving Innovation ♦ Delivering Results
USAEE Pittsburgh North American Conference
Plenary Session on Electricity Markets
Steve Bossart, Moderator
October, 2015
National Energy
Technology Laboratory
Session Topic
• Wholesale electricity markets and electricity deregulation
have been in place almost 20 years, and yet markets are still
constantly evolving. Changes to ISO/RTO area footprints, the
energy and capacity market structures, along with various
layers of regulatory uncertainty and the unique perspective
of the players create a dynamic environment. This session
will profile some of the market opportunities and challenges
facing the electricity industry today.
National Energy
Technology Laboratory
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Panelists
Mario DePillis
National Energy
Technology Laboratory
Howard Haas
Ingmar Sterzing
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ISO/RTO Market Areas – Independent System Operators /
Regional Transmission Organizations
CAISO
ERCOT
ISO-NE
MISO
NYISO
PJM
SPP
National Energy
Technology Laboratory
Source: FERC.gov
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US Status of Electricity Deregulation
National Energy
Technology Laboratory
Source: Energy Information Administration. Data as of: September 2010. Next Release - none
http://www.eia.gov/electricity/policies/restructuring/restructure_elect.html
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Utility A
Traditional utility vs. Unbundled utility
Generation
Transmission and
distribution
Customers A
Generation A
Independent
System
Operator
Generation B
Wholesale market
National Energy
Technology Laboratory
Customers
Transmission and
distribution
providers
Customers B
Retail market
A traditional utility is
responsible for
generation,
transmission, and
distribution of power
in its service territory.
In a deregulated
environment,
generation,
transmission, and
distribution are
unbundled.
Customers can
purchase from any
supplier on the grid.
Transmission owner
has to provide open
access. ISO/RTO
manages the
system.
Source: Dr. Marija Prica. NETL-ESPA 150.09.04. Transmission 101 presentation. December 19, 2012
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Issues
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Aging Infrastructure
Increasing Use of Technology & Equipment
Security – Physical/cyber
Changing outlook for the grid – generation portfolio & market
Evolution of Markets –Are markets driving policy or policy driving markets?
Review of Issues Impacting Markets & Risk Levels – Are Markets Responding Appropriately or Timely?
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Market Design issues – Energy Only vs Energy + Capacity, future speculation on need for a Reliability Market (Essential
Reliability Services such as VAR support, Reactive Power payments, etc. – much stronger than an ancillary services market
or performance based)
Investment Structures – how to incentivize, is proper cost allocation occurring?
Regulations – federal, state, local, siting, environmental, policy, etc.
Fuel Costs – shift from low cost coal to low cost natural gas;
Security – reliance on different or non-traditional generation sources (no longer baseload concept)
Change in Generation Resources – shift from central station to more distributive, will infrastructure (G or T) be built in
time to accommodate policies
Shift in Supply Side to Demand Side Opportunities
Intermittent Resources – increasing amounts due to RPS or other policy drivers
Reliability Impacts – how to design, finance & respond to operating a “tighter” grid
Transmission Opportunities – more wires for different resources
Market Uncertainties
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What are the Reliability/Planning Investment Opportunities?
How long can a market sustain these types of activities before requiring a change?
National Energy
Technology Laboratory
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