RGGI Markets Workshop 11-30-04: Summary and Key - PowerPoint PPT Presentation

Loading...

PPT – RGGI Markets Workshop 11-30-04: Summary and Key PowerPoint presentation | free to download - id: 20aa20-ZDc1Z



Loading


The Adobe Flash plugin is needed to view this content

Get the plugin now

View by Category
About This Presentation
Title:

RGGI Markets Workshop 11-30-04: Summary and Key

Description:

BOSTON DALLAS DENVER LOS ANGELES MENLO PARK MONTREAL NEW YORK SAN ... Boston, MA 02199. ph: 617-425-8114. fax: 617-425-8001. stierney_at_analysisgroup.com ... – PowerPoint PPT presentation

Number of Views:18
Avg rating:3.0/5.0
Slides: 15
Provided by: susan459
Learn more at: http://rggi.org
Category:

less

Write a Comment
User Comments (0)
Transcript and Presenter's Notes

Title: RGGI Markets Workshop 11-30-04: Summary and Key


1
RGGI Markets Workshop 11-30-04Summary and Key
Take-Aways
  • Susan Tierney
  • Presentation to RGGI Stakeholders Meeting
  • February 16, 2005

2
Markets Workshop 11-30-04
  • Summary of workshop
  • Overview of the Markets Dave Lawrence, NYISO
  • Issues for Traditional Suppliers Mark
    Brownstein, PSEG
  • Issues for Non-Traditional Suppliers Rich
    Cowart, RAP
  • Issues for System Operators Mark Babula, ISO-NE

3
Key Take-Aways from Presentations
  • Issues for Traditional Suppliers (Brownstein)
    Concerns about
  • leakage, especially in PJM where the regional
    market is a mixture of RGGI and non-RGGI states
  • exacerbating competitiveness impacts related to
    differences in market rules, between merchant
    generators in RGGI region and traditionally
    regulated, rate-based generators outside of RGGI
    region
  • effect of cap in creating environmental adder,
    putting economic pressure on relative
    competitiveness of coal-fired generation
  • fuel diversity in the Northeast power markets
  • timing of implementation of the cap relative to
    other key issues (e.g., end of standard of
    contracts, contents of bilateral contracts)
  • Implications of the design of the RGGI rule for
    its ability to serve as national model

4
Key Take-Aways from Presentations
  • Issues for Non-traditional suppliers (Cowart)
    Advocating the positions that
  • RGGI can not rely on traditional power markets
    alone
  • RGGI success depends upon ability to develop
    non-traditional resources (renewables,
    efficiency, and other distributed resources (CHP,
    price-responsive demand, etc.))
  • market and regulatory barriers persist which
    inhibit reliance on these resources
  • need for additional RGGI design issues to
    overcome these barriers (e.g., allocations of
    credits to these resources, output-based
    allocations)
  • need for other policy remedies (e.g., ISO
    transmission policy, ISO stand-by rates for
    alternative resources, system benefit charge
    enhancements) to address barriers

5
Key Take-Aways from Presentations
  • Issues for System Operators (Lawrence, Babula)
    RGGI design should take into account
  • cost and competitiveness implications for various
    types of generators
  • need to maintain certain uneconomic units needed
    for local reliability but which may have high GHG
    profile (and costs)
  • need for fuel diversity among power generators
    (including dual-fuel resources in winter)
  • Need for flexibility of system operators to deal
    with emergencies, siting, trades, fuel diversity
  • Role of the ISOs regarding tracking RGGI data,
    compliance
  • Special operational considerations associated
    with wind resources
  • Other design issues allocation of allowances,
    cap size and phase in, inter-temporal borrowing,
    leakage

6
Market-related issues for RGGI
  • Core RGGI Issues
  • Issues that must be addressed (one way or other)
    in RGGI design
  • Technically, critical success factors for RGGI
  • Collateral or Auxiliary RGGI Issues
  • Important to support RGGI objectives
  • Typically under responsibility of other entities
  • Not generators
  • Not RGGI regulatory entities

7
Central RGGI Issues Core Take-Aways
  • The value of regulatory certainty setting the
    rules sooner rather than later
  • Timing of announcing the RGGI architecture and
    requirements
  • Timing of implementing the RGGI architecture and
    requirements
  • Issues of timing interactions between phase-in
    plan and bilateral contracts not likely
    possible to get it just right everyway at the
    same time

8
Central RGGI Issues Core Take-Aways
  • The effects of leakage on the cap
  • Likely more important issue for RGGI states in
    PJM
  • Likely less important for RGGI states in NY and
    NE
  • Possible design remedies
  • Require imports to have allowances?
  • Require load-serving entities to hold allowances
    (a la Renewable Portfolio Standard)?
  • Regulatory hook for alternative approaches?
  • Need for inter-state consistency of approach?

9
Central RGGI Issues Core Take-Aways
  • Issue of fuel neutrality versus
    non-fuel-neutrality
  • No right design answer its a policy choice
  • Fuel-Neutral policy design may not have fuel
    neutral effect
  • Allowance allocations
  • Set-asides for different resources e.g.,
  • For efficiency?
  • For small clean resources?
  • For reliability-must-run units?
  • For new generators?
  • Output-based versus non-output based?

10
Central RGGI Issues Core Take-Aways
  • Important contextual issues but which are
    difficult to address directly in RGGI design.
  • Difficulties experienced by generators in RGGI
    states
  • e.g., merchant generators competing with
    rate-based generators
  • e.g., high fuel prices for gas-fired projects
  • e,g., non-diversity of fuel mix among power
    plants
  • e.g., in earning sufficient revenues to cover
    costs
  • e.g., in reliability-must-run units in certain
    locations
  • Difficulties experienced by clean power
    resources
  • e.g., transmission problems for renewables
  • e.g., lack of funding for energy efficiency
    investments

11
Central RGGI Issues Core Take-Aways
  • Some issues are important for regional power
    markets, but may not need big policy fix in
    RGGI design
  • Reliability-must-run units not clear why need
    special fix
  • Flexibility requirements for system operations
    make sure that inter-temporal trading and/or
    length of compliance period(s) allow
    for emergencies (e.g., system outages, fuel
    shortages)

12
Key Collateral or Auxiliary RGGI Issues
  • List of complementary issues and policy items to
    be pursued in parallel with RGGI
  • Identify set of problems that are barriers to
    accomplishing RGGI objectives
  • Many of these problems exist independent of RGGI
    initiative
  • Some are not even worsened by RGGI
  • Solving the problems will help accomplish
    solutions that reinforce RGGI goals
  • Suggest remedies that should be supported by RGGI
    states, but not necessarily part of RGGI Model
    Rule
  • Encourage continuing effort by RGGI states to
    address these collateral issues

13
Key Collateral or Auxiliary RGGI Issues
  • List of collateral issues
  • System benefit charges (for efficiency, for
    renewables)
  • Price-responsive demand initiatives
  • Rewewable portfolio standards
  • RTO/ISO policies with respect to wind resources
    (back up, transmission, intermittency, reactive
    power requirements)
  • Siting reforms (to take greenhouse gas emissions
    into account)
  • Retail pricing reforms
  • Wholesale market reforms

14
Susan F. Tierney, Ph.D.Managing
PrincipalAnalysis Group, Inc.111 Huntington
Ave., 10th FloorBoston, MA 02199ph
617-425-8114fax 617-425-8001stierney_at_analysisg
roup.comwww.analysisgroup.com
About PowerShow.com