Welcome to EnerKnol Pulse, where our mission is to bring you the most important energy sector news for the past week, powered by the EnerKnol platform.

January 22, 2018


Featured Topics

Renewable Policies and Projects

Rates and Power Markets

Reliability and Storage

Fossil Fuels


Featured Entities

Cassadaga Wind

Constitution Pipeline

Forward Energy

Georgia Power

Good Energy

Madison Gas and Electric

PG&E

PJM

SCE

SDG&E

Wisconsin Power and Light

Wisconsin to Wisconsin Public Service

Top News

PJM Proposes to Set Capacity Payouts for State-Backed Generators to Tackle Subsidy Threat to Market

PJM Interconnection LLC unveiled its plan to ensure payouts awarded to generators that help maintain the reliability of the mid-Atlantic electric grid are not depressed by low-bids from competing, state-backed power plants. Under the proposal, supply offers from generators receiving “actionable” out-of-market support would be administratively adjusted by PJM in the second of a two-stage auction, and would reflect the so-called net avoidable cost rate. PJM is the latest of multiple regional markets to adapt rules to a growing set of subsidies blamed for price distortions. The grid manager recommends that PJM’s board file the proposal with FERC next month and that it take effect after the May 2018 auction.

U.S. Rejects FirstEnergy's Bid to Transfer Ownership of West Virginia Coal Plant Amid Risk of Price Hikes to Consumers

The Federal Energy Regulatory Commission on Jan. 12 rejected a request by subsidiary Allegheny Energy Supply Company LLC to transfer ownership of its 1,159-megawatt Pleasants coal-fired generator to affiliate Monongahela Power Company after finding that the deal lacks measures to protect ratepayers from cross-subsidization and isn’t in the public interest. Generators are in search of subsidies and other measures to prop up money-losing power plants, as cheap, abundant natural gas has depressed energy prices and squeezed profits.

California Commission Adopts Rules to Allow Energy Storage to Realize 'Full Economic Value' in Power Market

The California Public Utilities Commission approved 11 regulations designed to enable energy storage operators to receive compensation for the multiple services they provide to the electric grid. The old market rules prevented batteries from tapping into revenues for services that were “stacked” together. Storage batteries are used for ensuring reliability of the grid through balancing supply and demand, deferring transmission and distribution projects and supporting microgrids, among other functions.

Federal Energy Regulator Upholds New York's Denial of Williams' Gas Line

The Federal Energy Regulatory Commission rejected Williams Partners LP’s argument that its Constitution Pipeline should have been awarded a water quality permit after New York failed to act within a reasonable timeframe. The U.S. agency’s Jan. 11 ruling found that the refiling of the application by Williams pushed back the deadline for the state to act. The project, which is designed to ship shale supplies from Pennsylvania to New York, comes as the Northeast’s reliance on the fuel for electricity generation is growing.

Renewable Policies and Projects

Colorado Senators Propose Bill to Boost State's Renewable Energy Goal to 100 Percent

Colorado state Democratic Senators Matt Jones and Mike Foote on Jan. 12 introduced legislation that would require utilities to source all of their energy from renewable sources by 2035 from the current goal of 30 percent by 2020. The draft bill is just the latest of several proposals by states, including California, to transition to 100 percent renewable energy as costs for the technology plummet. (SB 18-064)

EverPower Cleared by New York to Move Forward with 126-Megawatt Wind Farm

The New York State Board on Electric Generation Siting and the Environment on Jan. 17 approved subsidiary Cassadaga Wind LLC to construct up to 48 turbines in Chautauqua County following an assessment of its environmental impacts. New York’s Clean Energy Standard requires half of the state’s electricity to come from renewable energy sources like wind and solar by 2030.

Forward Energy Wins U.S. Approval to Sell 129 Megawatt Wisconsin Wind Facility

The Federal Energy Regulatory Commission authorized Forward Energy LLC to sell its 129-megawatt wind-powered generation facility in Wisconsin to Wisconsin Public Service, a subsidiary of WEC Energy Group Inc.; Wisconsin Power and Light, a subsidiary of Alliant Energy Corporation; and Madison Gas and Electric, a subsidiary of MGE Energy Inc.

Virginia Lawmaker Proposes Bill Expanding State Renewables Target to 80 Percent by 2026

State delegate Richard Sullivan, a Democrat, introduced legislation Jan. 10 that would require utilities to source at least 80 percent of its supplies from renewable sources by 2026. The state’s current mandate calls for utilities to derive an average of 15 percent of electricity from renewables in 2025. States including California and Colorado seek to strengthen procurement targets for wind and solar amid an influx of the generation.

Vermont Commission Explores Update to Net Metering Program as Part of Biennial Review

The Vermont Public Utility Commission on Jan. 12 opened a case to consider revisions to the state’s net metering program, including changes to residential rates and eligibility criteria for different categories. The agency, which adopted new net metering rules last year, set a March 1 deadline for proposals to be filed.

Rates and Power Markets

Georgia Power Ordered to Refund Customers $43 Million as Earnings Top Limits Set by Regulator

The Georgia Public Service Commission directed the Southern Company subsidiary to award payouts to ratepayers after the utility’s retail return on equity in 2016 surpassed the agency-approved 12 percent, according to a Jan. 16 press release. Two-thirds of the excess retail earnings will go to customers while Georgia Power will retain the remainder. The amount of the refunds has not been determined.

New York Approves Good Energy's Procurement Plan for Upstate Communities Seeking Better Rates

The New York State Public Service Commission on Jan. 18 approved a program for five municipalities in Central New York and the Capital District to buy electric and natural gas supplies for their residents. The so-called Community Choice Aggregation program, which is administered by a subsidiary of Good Energy Group, is aimed at providing communities more leverage to secure favorable prices from suppliers through bulk purchases. The program, the third in the state, will also consider ways to support customer-sited energy storage systems, purchase excess energy from customers with on-site generation, and secure green power.

Power Demand on Texas Grid Surges to Another Record in January as State Hit With Cold Blast

Historic low temperatures saw electric use on the grid managed by the Electric Reliability Council of Texas Inc. reach 65,731 megawatts, topping the last high of 62,855 megawatt set on Jan. 3. The grid operator reported sufficient generation and transmission reserves to meet the uptick in consumption.

New York Grid Operator Approved to Temporarily Waive Energy Offer Cap in Anticipation of Winter Price Spikes

The New York Independent System Operator Inc. received approval from the Federal Energy Regulatory Commission to temporarily waive the $1,000 per megawatt-hour offer price caps for the real-time and the day-ahead wholesale power market from early January through February. The measure seeks to ensure that generators are able to recover the cost of purchasing natural gas, which tends to surge when demand for the fuel to heat homes spikes, limiting supplies to run electric generators.

Reliability and Storage

California Seeks Spring Start for Expand Subsidy Program for Power Plants Needed for Reliability

The California Independent System Operator Corp. seeks an April 13 start for an expansion of its program compensating power plants at risk of retirement that are needed to ensure reliable electric service, according to a Jan. 12 request filed with the Federal Energy Regulatory Commission. The grid manager will establish two annual windows, up from one, for owners to request cost-of-service-based compensation for critical generators. The move comes as the threat of plant retirements in the state grows with the influx of renewable generation and lower power prices.

U.S. Energy Regulator Endorses Rules to Address Cyber Threat to Grid Systems

The Federal Energy Regulatory Commission proposed to approve new reliability standards by the North American Electric Reliability Corporation to mitigate cyber security risks associated with the supply chain for grid-related cyber systems, according to the commission’s Jan. 18 press release. The commission also proposed modifications to address gaps regarding electronic access control and monitoring systems, as well as evaluate risks posed by physical access controls and protected cyber assets.

Pacific Gas and Electric Authorized to Replace Calpine’s Gas-Fired Plants with Energy Storage

The California Public Utilities Commission authorized Pacific Gas and Electric Company to hold competitive solicitations for energy storage to meet power demand previously met by Calpine Corporation gas-fired plants, according to the commission’s Jan. 12 resolution. The commission expects the new portfolio to eliminate the need for “reliability must run” contracts filed by Calpine to operate two peaking units and a 580-megawatt generator.

Fossil Fuels

California Lawmakers Unveil Resolution to Protect Pacific Coast from Trump’s Offshore Drilling Plan, Citing Threat to Economy, Renewable Energy Goals

A coalition of ten California state Democratic Senators introduced a resolution on Jan. 12 urging President Donald Trump and the U.S. Congress to safeguard the Pacific Coast from new oil and gas leasing, seeking to preserve the coastal economy and transition away from offshore fossil fuel production to avoid the damaging impacts of climate change. The Trump administration on Nov. 2 proposed to open more than 90 percent of the outer continental shelf acreage for oil and gas development under its draft program, a sharp reversal from the current rules that put most of the acreage off limits. (SR 73)

U.S. Lawmakers Propose Bill to Ban Drilling Off New England Coast After Trump Lifts Moratorium

U.S. Democratic Senators Sheldon Whitehouse, representing Rhode Island, and Edward Markey, representing Massachusetts, introduced legislation on Jan. 11 that would ban offshore oil and gas leasing off the New England coast. The measure would protect ocean and coastal resources said to be an “economic engine” that contributes $17.5 billion annually to the region’s economy. The proposal follows a move by the Trump administration to open more than 90 percent of the outer continental shelf to natural gas and oil extraction. (S. 2298)

New York Governor Seeks Exemption from U.S. Offshore Drilling Plan, Citing ‘Unacceptable Threat’ to Coastal Economy, Climate Goals

Governor Andrew Cuomo asked the U.S. Interior Department to include New York in the list of states such as Florida, which have been excluded from the Trump administration’s plan to expand oil and gas drilling off the Atlantic Coast because of threats to the coastal economy. Cuomo said that the plan poses the risk of hazardous oil spills, accelerates climate change, and conflicts with the state’s offshore wind energy goal. The White House seeks to rollback restrictions on fossil fuel production to help the nation become a dominant player in the global marketplace.

Washington State Lawmakers Propose Decade Ban on Fracking Until Health, Pending Review of Risks to Health, Environment

A group of Washington State Democratic senators led by Sen. Andy Billig introduced a bill on Jan. 12 that would impose a moratorium on the use of hydraulic fracturing for oil and gas development in the state until 2028. The bill would require a report by 2023 providing the impacts the practice has on public health and the environment and proposed rules for regulating its use. Fracking, which involves pumping a mix of chemicals, sand and water to release natural gas and oil from underground deposits, has unlocked a glut of supplies, sending fuel prices to historic lows while putting the nation on course to become the top producer in the world. (SB 6345)

Natural Gas Supplied Nearly One-Third of U.S. Electricity in 2017, Becoming Leading Power Source for Second Year: EIA

Natural gas accounted for 32 percent of U.S. power generation and exceeded coal’s share of 30 percent amid low costs and plentiful supplies of the fuel, according to a Jan. 17 report from the U.S. Energy Information Administration. Less volatility in natural gas prices kept wholesale electricity prices stable in most of the U.S.