In 2023, EPSA continued to advocate for well-functioning competitive markets that bring benefits to consumers and businesses. Looking ahead to 2024, we are likely to see a critical year for our energy system. Between EPSA’s annual Competitive Power Summit, a reliability crisis that experts continue to highlight, and a critical slate of policy decisions on the horizon, 2024 will be one to watch.
In this Look Ahead, EPSA breaks down the trends and issues that are likely to shape the grid in 2024:
Coming from EPSA in 2024
2024 Competitive Power Summit
EPSA’s second annual Competitive Power Summit in 2023 saw North American Electric Reliability Corporation (NERC) President and CEO Jim Robb give the keynote speech where he highlighted growing challenges facing the electric grid, including widespread retirements of fossil generation, changing demand patterns, and the increasing threat of extreme weather.
EPSA’s third annual summit will continue the tradition of convening the leading experts from across the energy sector and providing an opportunity for stakeholders to discuss important developments in competitive electricity markets, answer pressing questions, and analyze what’s in store for the sector in 2024.
Attendees can look forward to panels discussing gas-electric coordination, reliability concerns in RTOs across the nation, and gas turbine innovation. Featured speakers will include:
- Jim Robb, President and CEO of NERC
- Julie Fedorchak, President of the National Association of Regulatory Utility Commissioners
- Diane Burman, Commissioner of the New York Public Service Commission
- Rich Dewey, President of the New York Independent System Operator
- Pablo Vegas, President and CEO of the Electric Reliability Council of Texas
EPSA Congressional Outlook
Coming soon from EPSA’s Government Relations Team: A breakdown of what the electricity industry can expect from Congress in 2024. EPSA’s team will provide insights into what will be the high-priority energy issues the 118th Congress will need to address, including the possibility of multiple FERC nomination hearings and the passing of the gavel on the Senate Energy and Natural Resources Committee.
What to Watch out for in Competitive Power this Year
The Pace of the Energy Expansion
Demand growth is rapidly accelerating for the first time in decades, and reliability fears persist as dispatchable resources are prematurely retired. Increased electrification and manufacturing growth will require more power from more sources. What is happening is not merely a transition. A comprehensive Energy Expansion that includes both dispatchable and intermittent resources is critical to meeting emissions reduction goals while also maintaining reliability. In 2024, EPSA will continue to lead the charge for an orderly energy expansion.
New Policies on Emerging Technologies
2023 saw significant policy changes on technologies that could one day reshape the energy industry. The Environmental Protection Agency (EPA) released new standards under the Clean Air Act’s Rule 111 that would mandate use of carbon capture and storage (CCS) and hydrogen technologies on existing natural gas-fueled plants. The agency faced significant backlash, as well as warnings from many stakeholders that these technologies are not yet advanced enough or commercially available. Regulatory mandates that ignore viability of technology threatens reliability. 2024 is likely to be a year of significant litigation over the proposed EPA rules.
2024 is also likely to be a significant year for hydrogen in its own right. In late 2023, the Treasury Department released proposed regulations for the 45V clean hydrogen production tax credit, meaning discussions around hydrogen projects will accelerate as the comment period commences and new projects are announced.
Movement on Gas-Electric Coordination
FERC and NERC’s report on 2022’s Winter Storm Elliot showed how a lack of coordination between the gas and electricity industries was a factor behind widespread grid challenges. Now, improving gas-electric coordination is a critical issue to address to ensure reliability in an increasingly gas-dependent power system. Experts agree that gas-electric coordination must be a priority moving forward. As EPSA President Todd Snitchler recently wrote:
“The errors in planning, forecasting, and logistics that caused more than 90 gigawatts (GW) of power generation in PJM and MISO to fail were complicated. But a critical fault line remains clear: gas-electric coordination. The fact that we have a gas production and delivery system that is not properly aligned with the critical and irreplaceable role natural gas plays in today’s electric system is undeniable. In PJM, natural gas has been the dominant fuel for electric generation since 2015. . . despite several cold weather events, multiple stakeholder meetings, and task force recommendations, we’ve not made any real progress on this problem. EPSA has been actively engaged and provided early recommendations to address the challenge.”
In November 2023, NARUC announced a new 15-month Gas-Electric Alignment for Reliability (GEAR) initiative. GEAR will see stakeholders representing both state and industry interest gather to, “develop solutions to better align the gas and electric industries to maintain and improve the reliability of both energy systems on which our nation depends for power.” The first update on the initiative will come in November 2024 at NARUC’s Annual Meeting and Education Conference with recommendations set to be announced at NARUC’s February 2025 Winter Policy Summit.
Other Things to Keep an Eye on in 2024
A Landmark Election Cycle
2024 is set to be a significant election cycle with the Presidency, all 435 House seats, 34 Senate seats, and countless local seats up for election. As the parties remain sharply split on issues such as permitting reform, emissions regulations, renewable subsidies, and a host of other energy topics, this election will likely play an outsized role in shaping the next decade of U.S. energy policy.
Biden’s Rush to Cement Regulatory Legacy
As President Biden’s term enters its last year, the Administration will be looking to frontload 2024 with regulatory priorities before election season takes front and center. Top agenda items will likely include nominations to FERC, which currently has two open seats, with a possible third should commissioner Allison Clement’s term expire without her renomination. FERC has yet to make a decision on its proposed transmission planning rule. The Environmental Protection Agency (EPA) also has a long list of proposed rules awaiting next steps in the regulatory process and the Biden administration will likely be looking to fast-track many of them. These include the proposed emissions guidelines for fossil fuel-fired power plants, authorized under Section 111 of the Clean Air Act.
The Deadline for State Plans under 111(d)
As part of the EPA’s proposed rule on emissions from power plants, announced in May 2023, states are required to, “submit plans to EPA that provide for the establishment, implementation, and enforcement of standards of performance for existing sources.” The original deadline was pushed back with the new deadline for states to submit plans by April 15, 2024.
What concerns Gen Z?
In 2024, 40.8 million members of Gen Z (ages 18-27) will be eligible to vote in the election. This means now more than ever, the thoughts, concerns, and priorities of this generation will be highly relevant to politicians, government officials and other stakeholders.
Data from a 2023 poll conducted by Morning Consult on behalf of EPSA provides insight into some of the energy priorities for this group.
- 40 percent of adults aged 18-34 prefer a competitive power market over an energy monopoly.
- 33 percent of those 18-34-year-olds who preferred a competitive market indicated that the ability to choose between providers drives their preference.
- 58 percent of this group is concerned about government policies retiring power plants without having adequate and reliable electricity replacements.
The Bottom Line
2024 will be an important year for the competitive power sector and EPSA will continue to advocate for the benefits of competitive markets and commonsense policies that put reliability first.