On February 2, Neil Levy and David Tewksbury, partners in McDermott’s Energy Regulatory, Markets & Reliability Practice Group, hosted Todd Snitchler, president and CEO of the Electric Power Supply Association (EPSA), for an in-depth discussion about developments affecting the competitive power sector as we move into 2022.
Below are the key takeaways from this discussion:
- Competition has benefited consumers by shifting risk from consumers to investors, lowering prices, and reducing emissions, while improving reliability. However, competitive power markets are facing challenges due to recent state actions and FERC decisions.
- Carbon pricing would be one way to address concerns regarding emissions within a competitive market framework.
- The federal government and states need to work together to preserve competition and ensure that state goals do not jeopardize reliability.
- Steps must be taken to ensure that resources required for reliability are not pushed out of the market.
- States have been focused on emissions reductions by subsidizing certain types of resources, which can result in lower market prices. At the same time, recent FERC actions have also reduced revenues for various resources.
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