House committee hearing examines electricity delivery in period of transformation
The House Energy and Commerce Committee held a hearing this week on strengthening electricity delivery during a period of transformation due to technological innovation and market competition in the industry.
“Americans now expect their power on demand. However, producing and delivering electricity from a power plant to our homes and businesses is becoming increasingly complex. New market participants offering advanced technologies and innovative services are changing the face of the industry faster than many have expected, and that pace of change will only increase with time,” Committee Chair Rep. Greg Walden (R-OR) said.
At the same time, electricity prices are at near record lows around the country, Walden continued.
“While this is largely a result of cheap and plentiful natural gas supplies, the emergence of renewable resources are also affecting the composition of the power being generated as well as the market clearing prices,” Walden said. “As a result, in regions with competitive markets that dispatch generation based solely on lowest-cost, we are seeing that some traditional “baseload” units, such as nuclear and coalfired plants, cannot compete because they are too expensive to operate within their markets, causing some plants to retire before the end of their useful life,” Walden added. “While on its face, low electricity prices are a boon for consumers and businesses, we are now hearing from some segments of the industry that the loss of nuclear and coal units from the generation fleet could have longer-term impacts on grid reliability.”
Grid reliability is one of the issues that the committee will be exploring, Walden said.
Alex Glenn, senior vice president, state and federal regulatory legal support at Duke Energy Corporation, laid out five legislative actions Congress could take to benefit consumers.
“First, establish a reasonable “shot clock” for actions on permit applications, as many critical infrastructure projects face unnecessary and costly delays,” Glenn said. “Second, retain the federal income tax deduction for interest expense, which helps to keep electricity rates as low as possible for customers. Third, update the Public Utility Regulatory Policies Act (PURPA) to enable utilities to serve customers at the lowest cost. Fourth, move forward on the Federal Energy Regulatory Commission (FERC) Commissioner nominees as soon as possible. And lastly, enhance cybersecurity by amending the Safety Act to expressly include cyberattacks, and improve the process to obtain a security clearance so that we can increase the information sharing capabilities between public and private entities.”
This was the first in the committee’s “Powering America” series of hearings, designed to give members of the committee the opportunity to explore electricity markets, learn more about electricity generation, distribution, and consumption, and the resiliency of the electric grid.
As Chairman of the Energy and Commerce Committee, Walden has called for a consumer-focused approach to improve and modernize energy infrastructure in Oregon and throughout the country.
“As I’ve said previously, at the end of the day, our goal is to serve the best interests of consumers,” Walden said.
