PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Multi-Trade Electricity Consumer Letter to FERC

By at 12 June, 2019, 9:52 am

Chairman Neil Chatterjee

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

 

Commissioner Richard Glick

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

 

Commissioner Cheryl A. LaFleur

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

 

Commissioner Bernard L. McNamee

Federal Energy Regulatory Commission

888 First Street, NE

Washington, DC 20426

 

Dear Chairman Chatterjee, Commissioner LaFleur, Commissioner Glick, and Commissioner

McNamee:

 

As associations representing the commercial and industrial sectors, as well as, residential

ratepayers and public interest groups, we are writing to urge the Federal Energy Regulatory

Commission (FERC) to continue its leadership role in encouraging the evolution of competitive

wholesale electricity markets and to consider several critical issues as part of your agenda and

activities going forward.

 

Two decades ago, consistent with the principles and requirements of the Federal Power Act,

FERC encouraged the formation of regional transmission organizations (RTOs) and

independent system operators (ISOs), with the goals of promoting economic efficiency,

reliability, and non-discriminatory access to the transmission grid.

 

Since that time, multiple studies have found that competitive wholesale electricity markets can

deliver significant benefits to electricity customers, including greater efficiency, lower electricity

prices, and robust reliability. Competitive wholesale electricity markets can also encourage

investment in innovations that are transforming the grid and delivering significant value to

customers, such as clean energy generation as well as energy storage, distributed energy

resources, and demand response technologies.

 

However, as you are quite aware, RTO and ISO decision-making processes do not always

adequately consider the voices of customers, innovators, and other new entrants to wholesale

electricity markets. The processes often favor incumbents, which have resulted in problems with

transparency, accountability, and market performance. Customers are also concerned about

growing tensions among states, market operators, and Federal policymakers related to the

evolution and operation of wholesale electricity markets. In some regions, state preferences and

mandates for energy generation do not always align with market outcomes. In some markets,

choices in market design create unintended barriers to adoption of emerging technologies.

 

These issues are complex, and solutions will necessarily involve rigorous analysis and diverse

stakeholder input. As FERC continues its mission and mandate to ensure open access,

reliability, and just and reasonable electricity rates, we urge you to consider the following:

 

1.FERC should ensure that RTOs and ISOs adhere to key principles necessary for the

efficient and effective operation of wholesale electricity markets, namely: transparency in

decision-making, independence from undue influence, and fair representation of all

stakeholders consistent with Order No. 719.

 

2. FERC should continue to fulfill its role in providing strong oversight to ensure RTO and

ISO accountability not only to these principles in concept, but also in practice. RTO and

ISO decision-making processes—and which stakeholders are empowered to shape

them—will impact the success of each and every priority of the Commission, including

resiliency, cybersecurity, and the transition to a modern grid.

 

3. FERC should ensure wholesale electricity markets continue to enable access to

advanced technologies, which benefit consumers by lowering costs and improving

service quality. Innovation in generation, transmission, communications technologies,

and consumer-centric business models are already creating value for electricity

customers and the grid as a whole. FERC should be a leader in this transformation.

 

4. FERC should ensure the independence and effectiveness of the RTO and ISO

Independent Market Monitors (IMMs) and the IMMs’ right to file complaints regarding

market deficiencies.

 

5. FERC should consider mechanisms for ensuring all U.S. electricity customers can

realize the benefits of wholesale market competition.

 

More than ever before, competitive wholesale electricity markets are poised to unleash the costeffective, clean, reliable, and resilient solutions that electricity customers demand and deserve.

 

With FERC’s continued leadership and oversight, we can accelerate the transition to a modern

grid while empowering consumers and protecting the public good.

 

We look forward to continuing a dialogue with you on these critical issues.

 

Sincerely,

American Chemistry Council

American Forest and Paper Association

Business and Institutional Furniture Manufacturers Association

Electricity Consumers Resource Council

Heritage Action for America

National Association of State Utility Consumer Advocates

National Retail Federation

Portland Cement Association

Public Citizen

R Street Institute

Retail Industry Leaders Association

Small Business Entrepreneurship Council

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