On March 29, the Electric Power Supply Association hosted its first Competitive Power Summit in Washington, DC. Leaders from across the competitive power market discussed the key issues facing the sector, including maintaining reliability as the grid changes, market innovations, advancing decarbonization, ensuring a just transition with continued customer and economic benefits, and future market design. While there was much to debate around these topics, many speakers agreed on the basic tenets of what’s necessary to achieve reliable, affordable, and clean power.
This is the second installment of a six-part blog series on the themes and key takeaways from EPSA’s Competitive Power Summit, which will highlight how the competitive power sector can continue to deliver energy reliably as the grid continues to evolve to address decarbonization policies.
In case you missed it, part one is available here.
Addressing Reliability in a Changing Grid
“The last two years have brought extraordinary clarity to the risks we have embedded in the system, driven by changing climate dynamics. These weather systems are longer, deeper, broader. Longer in duration, deeper with more extreme temperatures, and broader with the breadth of the country that is impacted,” said Jim Robb, president and CEO, North American Electric Reliability Corporation.
From heat domes covering the western U.S. to Winter Storm Uri’s frigid temperatures, demand for grid reliability today is high and will only increase as more sectors decarbonize through electrification. Robb noted that to ensure reliability in the future, system operators, power generators and fuel suppliers will need more situational awareness among each other, and they must come to grips with how the sector thinks about reliability and resource adequacy. The panelists agreed that the sector will need to shift to a mindset where system performance plays an increasing role alongside capacity.
Competitive power markets can help facilitate the coming transition and have proven over the past 15 years that reliable energy can be delivered at affordable rates while reducing carbon emissions by 33 percent, according to Robb. However, as more intermittent renewable resources come online, there will be an increased need for low-carbon, grid balancing solutions, which could include hydrogen, batteries, nuclear and others. Today, natural gas serves as the balancing resource necessary for grid reliability. While natural gas’s role may change over time, what cannot change is access to reliable power.
During the course of the summit, panelists agreed that competitive power markets must be responsive to customers, nondiscriminatory towards specific technologies, cover the duration of assets and respond to out-of-market interventions.
In part three of the Competitive Power Series, we will present the key findings from the “Innovation in Competitive Markets” panelists.