FirstEnergy and AEP, the holding companies that control most of the electricity systems in OH and WV, are pushing to prevent solar power producers from being paid for their contribution to PJM’s capacity needs in OH. Using OH’s regulatory system to underpay small producers would also allow the small producers’ energy at a discount and sell that energy at a profit to their own customers.
The EcoWatch story also covers FE’s attempts at FERC to block the sale of demand resources in PJM’s capacity markets.
Meanwhile, on the federal level, FirstEnergy’s ongoing FERC challenge aims to exclude demand response from the results of May’s capacity auction for 2017-2018.
“We believe that removing these demand resources from the capacity market is going to provide vital compensation for essential physical assets like nuclear, coal, [and] gas base load plants,” Colafella said. “It’s going to help foster properly functioning capacity markets.”
“Demand response presents absolutely zero reliability concerns,” Sawmiller noted. “It won’t freeze like a coal plant did during the polar vortex. In addition, it’s incredibly cheap. This applies downward pressure to capacity prices, lowering electric bills for all customers.”
“If FirstEnergy is able to reduce the amount of demand response that goes into these auctions, it will raise prices for customers,” Sawmiller added.
“Having demand response bid in lowers the price for all the generators that bid in,” Kushler agreed. Conversely, keeping demand response out would raise the auction’s closing price. In Kushler’s view, FirstEnergy’s attempt to exclude it is yet another “classic conflict of interest.”
The coal burning power companies like to tout their “steel in ground” as the ultimate in reliability, but Dan Sawmiller is right, coal does not do well in cold weather. Here is PJM’s report on the electric generation industries last January. The report highlights the fact that on January 7, 34% of the forced generation loss was from coal-fired plants.
So the AEP/FE, Kochtopus, Republican rollback of sane OH energy policy continues.
While in WV’s regulated market AEP and FE are shifting power plants from unregulated subsidiaries onto captive WV rate payers to protect profits, in OH, the holding companies are manipulating rules under which their regulated retail companies operate to jack up profits for their unregulated generation companies. In both states, both holding companies are playing rate payers and PSCs for chumps.