We help clients develop strategies for profitable engagement in wholesale electricity markets. Participants, including utilities, are able – sometimes expected – to participate in power markets, yet are sometimes unsure of how to proceed due to complex rules and penalties for misjudgment.
The Federal Energy Regulatory Commission is keenly interested in developing wholesale market products, including direct bid-in dispatchable demand response. FERC Order 719 is intended to greatly increase the quantity of demand response that is aggregated at the retail (utility) level and sold at the wholesale (ISO/RTO) level. FERC estimates that 32 GW of DR exists today, up 84% from 2006, with the potential for much more. Regulated utilities with a portfolio of MWs under management are under pressure to transition these resources into wholesale markets.
A related development outlined in the National Action Plan (2010) reflects the intention to introduce energy efficiency resources into wholesale electricity markets. This is becoming feasible as electric devices become easier to monitor and real time information more accessible. Today two wholesale markets – ISO New England and the PJM Interconnection – permit energy efficiency to participate in capacity markets, but additional ISOs/RTOs will be opening to these products. This creates an opportunity for utilities to leverage their energy efficiency portfolios in wholesale markets, and a parallel challenge to do so strategically.
Our role is to help organizations that are overwhelmed by cascading new market rules make sense of both the requirements and the opportunities for strategic participation. We are helping large utility clients on both the East Coast and West Coast develop strategies for wholesale market participation in forward capacity markets and other programs. Ryn Hamilton has completed ISO-NE forward capacity market training certification.