News and Analysis
The Independent Market Monitor recently studied how the change in the Minimum Offer Price Rule (MOPR) by the Federal Energy Regulatory Commission (FERC) will impact PJM capacity market prices.
The study concludes that the change should not increase PJM capacity market prices due to exemptions for various existing resource types (e.g. demand response and renewable energy), as well as little change in the handling of new natural gas power plants. Another reason cited by the study: existing state-subsidized nuclear plants outside Ohio being able to bid at competitive prices, lower than the minimum offer prices, through the resource specific exemption. 4/9/2020
The U.S. Energy Information Administration has several data tools that offer a glimpse at current energy markets, all of which are feeling the effects of COVID-19. You can investigate regional electricity use, petroleum supplies, gasoline and diesel fuel prices, natural gas storage, and much more. 3/31/2020
Electric demand across regional transmission organization PJM‘s 13-state footprint — which includes all of Ohio — has declined this week as consumers hunker down due to the spread of the coronavirus. As businesses and public entities take steps to protect employees, PJM says such actions are bound to translate into further changes in the demand needs of its 65 million customers. 3/18/2020
This week, PJM filed tariff changes at the Federal Energy Regulatory Commission (FERC) in response to its landmark order — issued in December to protect competitive wholesale electricity markets against unfair competition from subsidized actors.
The changes to the Minimum Offer Price Rule (MOPR) will potentially affect revenue for Ohio’s two nuclear power plants, OVEC’s coal-fired power plants, select large-scale solar projects, and the Sammis coal-fired power plant. All of these power plants are eligible to receive direct subsidies from Ohio ratepayers as a result of last year’s House Bill 6, or are receiving indirect subsidies in the case of Sammis.
PJM has recommended a 35-day comment period, and a six-and-a-half-month lead time from FERC’s acceptance of its tariff changes to when it would hold the next capacity auction. PJM’s capacity auction, already a year behind, may not occur until late 2020. 3/19/2020
Pennsylvania to Join the Regional Greenhouse Gas Initiative as EnergyHarbor Rescinds Nuclear Plant ClosureMarch 20, 2020
Pennsylvania’s nuclear and renewable energy power plants may continue to receive PJM capacity revenue — while Ohio’s may not. Here’s why:
It has been reported that EnergyHarbor, the company formerly known as FirstEnergy Solutions (FES), has rescinded its closure of the Beaver Valley nuclear power plant in Pennsylvania. Not that long ago, FES had argued to the Pennsylvania General Assembly that the plant was uneconomical, but it failed to win approval of state subsidies — the opposite of what happened in Ohio. Now Pennsylvania intends to join the multi-state carbon market known as the Regional Greenhouse Gas Initiative (RGGI), prompting the reversal of Beaver Valley’s closure. RGGI’s compensation to nuclear power plants for no-carbon power is unlikely to be qualified as a state subsidy. 3/19/2020
This week, the OMA Energy Committee held its first quarterly meeting of 2020 to review numerous regulatory and legislative matters that could affect Ohio manufacturers, including post-House Bill 6 activity and the December 2019 FERC order.
Meeting highlights included a presentation from Tim Ling, corporate environmental director at Plaskolite, who provided insightful analysis into energy management in an unstable environment. Greg Bechert of Scioto Energy gave members a comprehensive look at electricity market trends, while Richard Ricks of NiSource, Columbia Gas of Ohio briefed members on natural gas trends. Also discussed was the recent drop in oil prices and its impact on oil and natural gas supplies.
The next meeting of the OMA Energy Committee is scheduled for Thursday, May 21. All members are welcome to register for in-person or by-phone participation. 3/12/2020
Regulatory proceedings have big impacts on how much Ohioans pay for their electric service. To drive that point home, the Energy News Network this week published an online, interactive segment that allows readers to decide how they would rule on real cases recently decided by the Public Utilities Commission of Ohio or the Supreme Court of Ohio. After answering, readers find out how their answers compare to what actually happened. 3/12/2020
This week, Brad Belden — president of The Belden Brick Company, Canton, and chair of the OMA Energy Committee — testified before the Ohio Senate Energy and Public Utilities Committee. In addition to making suggestions for an improved regulatory and policy environment, he told senators to stay the course on deregulation, cautioning against a state-administered capacity pricing mechanism for nuclear, coal, and solar generation (similar to the one that currently faces disqualification from the wholesale market).
A new study shows a ban on federal leasing and fracking would have dire consequences for businesses and families nationwide. Commissioned by API, the study finds such a ban, which some presidential candidates have proposed, would threaten as many as 7.5 million U.S. jobs in 2022 alone, lead to a cumulative GDP loss of $7.1 trillion by 2030, and lower household incomes by $5,400 annually. Among the hardest hit states would be Ohio, with an estimated 500,000 lost jobs. Get more details. 3/5/2020
It’s not too late for members to register for the OMA Energy Committee’s first meeting of the year, set for Thursday, March 12, in Columbus. Members may participate either in person or by phone. The meeting will be held from 10 a.m. to 1 p.m., and it includes lunch. Key topics will include FERC’s December order on state-subsidized power, Nexus Transmission Pipeline opportunities for manufacturers, and natural gas and electricity forecasts. 3/5/2020