By David J. Hayes
December 3, 2020
Next Wednesday, Massachusetts Attorney General Maura Healey is holding a virtual “teach-in” that will address how regulated power markets are slowing, and making more expensive, the state’s transition to clean energy. In a remarkable video about the upcoming event, Attorney General Healey’s office uses plain language to describe how outdated rules challenge the clean energy future. The video explains that the electric grid operator (ISO-New England) “must move quickly to modernize market rules for the clean energy transition” so Massachusetts residents don’t “pay twice” by “investing in the new affordable clean energy sources that we need while also paying older, dirtier sources to stick around.” More broadly: “Clean energy means more jobs, lower prices, healthier air, and a healthier climate.”
Attorney General Healey’s unique “teach-in” tells us a lot about the clean energy transition in the United States.
It reminds us, first, that states are leading the climate and clean energy charge. States like Massachusetts have established aggressive, action-forcing climate and clean energy laws and policies that are disrupting the long-staid electric utility sector. Status quo reliance on lumbering dirty power sources no longer cuts it. Clean energy and modern, efficient grid tools are the new order of the day.
Second, as a corollary, state attorneys general have a duty to fight federal policies that undercut state energy interests. This teach-in is right in line with AG Healey’s impressive history of calling ISO-New England to task for adopting policies that favor fossil fuel incumbents over clean energy innovators. Other attorneys general have been active in their regions; for example, three state attorneys general in the PJM Interconnection region (AGs Brian Frosh of Maryland, Kathy Jennings of Delaware, and Gurbir Grewal of New Jersey) vowed to fight PJM’s “reckless and heavy-handed” Minimum Offer Price Rule which “discriminates against state preferred resources” and will “cost our residents billions of dollars, and delay our progress toward a clean energy economy.”
More generally, a group of 11 state AGs wrote a letter earlier this fall that reminded the Federal Energy Regulatory Commission (FERC) – and, by extension, their grid operators - that their states have acted “to drastically reduce climate-warming greenhouse gas emissions and to promote clean energy resources” and “facilitate the ongoing modernization of the power sector.” Rather than fight those state prerogatives, the letter called on FERC to accommodate them, as required by law, and consistent with basic competition and consumer protection principles. The letter made four key recommendations to FERC (emphasis added):
- “The Commission should promote market design choices that appropriately recognize the rights of states under the Federal Power Act to shape their resource mixes. It is not just and reasonable to seek high prices to maintain the competitiveness of aging, uneconomic, and higher-emitting resources by discriminating against state-supported cleaner technologies.
- The Commission should eliminate barriers to competition for renewable energy generators, energy storage, energy efficiency, demand response, and other innovative clean energy technologies.
- In evaluating proposed new pipeline infrastructure and other projects and actions, the Commission should comprehensively assess the associated climate impacts and all reasonable clean energy alternatives.
- The Commission should exercise its oversight authority to ensure that Regional Transmission Operators and other regulated entities are fostering participation, transparency, independence, and responsiveness to states, consumers, and other stakeholders.”
AG Healey’s upcoming teach-in makes advocacy for these key issues accessible to those less-well-versed in the complex rules and jargon of electricity markets that incumbent energy producers have long used to their advantage. FERC and the organized wholesale market operators that it oversees – including ISO-New England and PJM – have a fresh chance to work with, not against, state clean energy and climate interests. Here’s hoping the attorney general community will be successful in setting us on a new course.
David J. Hayes is a nationally recognized environmental, energy and natural resources lawyer who leads the State Energy & Environmental Impact Center.