EPSA President and CEO Todd Snitchler emphasizes the importance of well-structured, regulated competitive power markets – particularly capacity markets – for ensuring reliability and attracting resource investment in preliminary statement submitted to FERC.
Venue: Federal Energy Regulatory Commission
Date Submitted: May 16, 2025
Proceeding: AD25-7-000, Meeting the Challenge of Resource Adequacy in RTO and ISO Regions
Summary: On May 16, EPSA submitted to FERC staff the pre-conference written statement of Todd Snitchler for the Commissioner-led Resource Adequacy Technical Conference scheduled for June 4-5. Mr. Snitchler is participating on a panel on June 5 regarding MISO Resource Adequacy Challenges, though the preliminary statement addresses the array of questions posed to panelists in the published conference agenda. Mr. Snitchler focuses on the benefits of properly structured and regulated wholesale competitive electricity markets, including capacity markets, to meet resource adequacy challenges. EPSA urges the Commission, along with other federal and state regulators and policymakers, ISOs/RTOs, and stakeholders to work to establish and support a policy landscape that maintains the viability of existing capacity and creates a predictable and stable environment to attract new investment.
Key Points:
1. Emphasis on Dispatchable Resources: Snitchler underscores the critical role of dispatchable power sources, particularly natural gas-fired generation, in maintaining grid reliability amid the increasing integration of intermittent renewable energy sources.
2. Advocacy for Competitive Markets: EPSA advocates for competitive wholesale electricity markets as the most effective mechanism to ensure reliability, affordability, and innovation in the energy sector. These markets attract private capital, drive technological progress, and shift risk from consumers to generators.
“No matter how resource adequacy is achieved – whether through a capacity market or state level planning – ensuring a sufficient quantity of both existing and new capacity will require investment, and that investment will be reflected in wholesale prices. To suggest that this can be avoided is simply unrealistic.”
3. Concerns Over Regulatory Challenges: Regulatory burdens and subsidies can create economic disadvantages for unsubsidized resources, potentially leading to the premature retirement of essential dispatchable resources.
4. Need for Market-Based Solutions: EPSA calls for the development of market-based services or products to maintain efficiency in energy, capacity, and ancillary services across all power system resources.
5. Letting Utilities Rate Base Generation Is a Step Backward: EPSA pushes back on considerations of allowing vertically integrated utilities to rate base new generation. This shifts investment risk from shareholders to customers, undercuts competition, and stifles innovation. Making such a shift would not resolve the non-market barriers faced by competitive suppliers as vertically integrated entities would face the same challenges with respect to interconnection queue delays, supply chain, and permitting and siting.
6. Capacity Markets Are Critical but Must Evolve: EPSA supports well-designed capacity markets as essential to long-term reliability. These markets send investment signals that ensure needed resources are available when energy markets alone don’t provide enough financial incentive. However, they must evolve to better reflect reliability contributions from all resource types, including emerging technologies.
7. Call for Structural Solutions Outside RTOs/ISOs: EPSA recommends implementing structural remedies, such as independent entities to administer certain transmission functions, to mitigate market power and facilitate the development of Regional Transmission Organizations (RTOs) and Independent System Operators (ISOs).
