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Assessment of potential market reforms for south carolina’s electricity sector

Brattle Group, April 2023

This report was developed pursuant to Act 187, which was enacted in September 2020, and prepared for the Electricity Market Reform Measures Study Committee of the South Carolina General Assembly. The study examined the nature and size of potential benefits that could be achieved by market reforms in the electricity sector. 

Western Assessment of Resource Adequacy

Western Electricity Coordinating Council, November 2022

Prepared by the Western Electricity Coordinating Council (WECC), the Western Assessment is an energy-based probabilistic analysis of resource adequacy across the entire Western Interconnection for the next ten years. This Assessment found that severe weather events in the West over the last several years have demonstrated the vulnerability of the power system to resource adequacy risks. In addition, with the majority of western states committed to aggressive clean energy targets and new federal energy policies dedicating billions of dollars to clean energy development, rapid changes to the mix of available resources will continue and is likely to increase in magnitude and pace for the foreseeable future. 

Western RTO Economic Impact Study

Advanced Energy Economy, July 2022

This study found that establishing a broad, West-wide organized electricity market known as a Regional Transmission Organization (RTO) would create as many as 657,000 permanent, high-paying jobs in the West. The study also found that a Western RTO would diversify state economies and save ratepayers millions of dollars per year in energy costs. The 11 states studied in the report were Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming. The analysis found all 11 states could expect economic benefits from a West-wide RTO, driven by lower electricity prices for households and businesses, additional clean energy development across the region, and the expansion of existing, as well as attraction of new, businesses to the West. 

The Impacts of Wholesale Market Rules and Policies on Clean Energy Goals: A Primer for Local Governments

World Resources Institute, March 2022

This paper discusses the evolving rules and policies of wholesale markets that can create barriers to local governments' achievement of an effective and rapid clean energy transition. The report reviews the current barriers associated with transmission, market rules, and stakeholder processes across these markets while considering how these barriers affect local government clean energy and decarbonization goals, and the role of effective engagement in addressing these barriers. 

Regional Transmission Organization Study: Oregon Perspectives

Oregon Department of Energy, December 2021

The Oregon Department of Energy, in consultation with the Oregon Public Utility Commission, prepared the report for submission to the Oregon Legislature consistent with the requirements of Senate Bill 589 (2021). The report identified widespread agreement among stakeholders on the value of increased regional coordination and collaboration, but it also identified a need to delicately balance competing interests—across different types of utilities, state and federal entities, various states, and other interested stakeholders—in order to forge solutions that achieve the common objectives of stakeholders inside and outside of Oregon. 

Colorado Transmission Coordination Act: Investigation of Wholesale Market Alternatives for the State of Colorado

Colorado Public Utilities Commission, December 2021

The Colorado Public Utilities Commission conducted this study as part of the Colorado Transmission Coordination Act. The study found that enhanced market participation through greater regional coordination can reduce total annual costs for Colorado electric utilities by as much as 4 to 5 percent, while helping to accelerate the achievement of our state’s clean energy goals. The study also  demonstrated “full participation by the electric utilities in a (regional transmission organization) could deliver approximately $230 million annually” through sharing reserves, and operating costs and infrastructure investment savings. At the same time, this study also identified significant concerns with shifting core aspects of electric utility regulation (involving new generator interconnection, transmission expansion, and resource adequacy) from state control to regional processes due to significant governance issues.  

U.S. Organized Wholesale Electricity Governance Primer

Clean Energy Buyers Institute, September 2021

The Primer compares key governance and decision-making elements across the seven Regional Transmission Organizations/Independent System Operators (RTOs/ISOs) in the U.S., highlighting the importance and impact to electricity customers. Elements are structured in a top-down approach, beginning with discussion on regulatory oversight and governing bodies, and ending with stakeholder participation and independent evaluation of RTOs. 

Actions Large Energy Buyers Can Take to Transform and Decarbonize the Grid: Procurement Practices for Achieving 100% Carbon Free Electricity

World Resources Institute, August 2021

This paper discusses energy buyers—including companies and cities—role in the clean energy transition. Moving forward, however, large energy buyers will need to go further and take additional actions to help create a zero-carbon electric grid by 2050. This paper discusses how “transformative procurement practices” can optimize how, when and where clean energy is deployed to help reduce long-term emissions. 

Exploring Western Organized Market Configurations: A Western States’ Study of Coordinated Market Options to Advance State Energy Policies

Energy Strategies, July 2021

The two-year study, titled, “Exploring Western Organized Market Configurations: A Western States’ Study of Coordinated Market Options to Advance State Energy Policies (the State Market Study)," compared a “business-as-usual” scenario to a series of theoretical “future case” electricity market structures. At the high end, the study found annual benefits of up to $2 billion from a western regional transmission organization (RTO) in 2030, although that finding does not include ongoing costs to operate an RTO. Eleven western states—Arizona, California, Colorado, Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming—provided representatives from both state energy offices and public utility commissions, for a lead team that guided the study. The States Market Study was funded through a DOE State Energy Program competitive award to the Utah Office of Energy Development, in partnership with Colorado, Idaho, and Montana. 

Local Government Voices in Wholesale Market Issues: Engagement Approaches for Decarbonization

World Resources Institute, March 2021

This paper presents three main avenues for local governments to get involved in wholesale energy market issues concerning renewable energy: through public statements, at the Federal Energy Regulatory Commission (FERC) level, and at the Regional Transmission Organization (RTO)/Independent System Operator (ISO) level. In many cases, working collaboratively can help local governments overcome barriers like limited capacity, expertise or funding. 

Organized Wholesale Markets and Corporate Advanced Energy Procurement

Advanced Energy Buyers Group, January 2021

This report explains why organized competitive wholesale markets operated by Regional Transmission Organizations and Independent System Operators (RTOs/ISOs) are foundational to many of the strategies that large energy buyers rely on to increase their use of advanced energy and meet their sustainability targets. Specifically, the report describes the massive market opportunity and explains why expanding these markets to new regions and improving the design and operation of existing RTOs/ISOs would create more opportunities for corporate advanced energy procurement. 

Western Energy Imbalance Services and SPP Western RTO Benefits

Southwest Power Pool, December 2020

This study, prepared for the Southwest Power Pool (SPP), estimates the production cost benefits that would likely result from the creation of the Western Energy Imbalance Services (WEIS) Market and from extending the full SPP Regional Transmission Organization (RTO) market to include the WEIS footprint. The report found that the creation of the WEIS real-time imbalance market with coordinated real-time imbalance transactions across the direct current (DC) ties reduces adjusted production cost (APC) by $9 million/year for WEIS members and by $7.1 million/year for the current SPP members. The WEIS Market produces benefits by allowing for increased flows of low-cost power from the western part of the SPP footprint across the DC ties into the WECC. The report also found that the creation of the SPP West RTO creates benefits of $25 million/year for WEIS members and $24.2 million/year for current SPP members. The full integration of the WEIS footprint into the SPP RTO means power can flow from the current SPP footprint into Arizona, New Mexico, Utah, and other areas in the WECC while paying a single wheeling fee.  

Electric Competition: The Anecdote for Bad BehavioR

R Street Institute, September 2020

This paper underscores how the perverse incentive structure of monopoly regulation institutionalizes extensive rent-seeking behavior, but a quasi-restructured market retains major vulnerabilities. As such, policymakers and regulators should priorities the following: 1) restructure properly: isolate monopolies to distribution services only; 2) regulate distribution monopolies properly; and 3) remain disciplined. 

How Voluntary Electricity Trading Can Help Efficiency in the SoutheasT

R Street Institute, August 2020

This study described various voluntary trading mechanisms, such as energy imbalance markets (EIMs) and several existing mechanisms for voluntary energy exchange in the Southeast. The study found if Southeastern utilities wish to trade on a voluntary basis, the Energy Imbalance Market, a voluntary market operated by a regional transmission organization (RTO), is a model with quantified success, and leveraging an existing market platform could be less costly than setting up a new market or exchange. The study also found that factors for success in cost and emissions reduction include a footprint with a diversity of resources and customer demand, as well as energy storage that helps avoid curtailing zero-marginal-cost energy. Specifically, centralized market operation can help optimize the system every five minutes, which increases the flexibility of the system and can enhance reliability. 

Economic and Clean Energy Benefits of Establishing a Southeast U.S. Competitive Wholesale Electricity Market

Energy Innovation, August 2020

This report utilized a combined production-cost and capacity expansion model of the electric power system in seven Southeastern states (Alabama, Florida, Georgia, Mississippi, North Carolina, South Carolina, and Tennessee) out to 2040. The report found that a competitive Southeastern RTO creates cumulative economic savings of approximately $384 billion in by 2040 compared to the business-as-usual case. 

Evaluating Options for Advancing Wholesale Competition and Implications for the Southeastern United States

Duke University Nicholas Institute for Environmental Policy Solutions, March 2020

This paper evaluated options for enhancing competition, compared to how utilities traditionally operate the electricity grid, in the Southeastern United States, specifically focusing on wholesale transactions between generators and utilities serving end-use customers. The paper found that enhancing competition for wholesale transactions through a regional organized market, depending on details, is likely to lower wholesale costs, provide nonincumbent generators with easier access to the system, and improve power system efficiency and flexibility. The paper also found that organized regional markets offer relatively more transparency, educational training, and market monitoring, which are important for customers and nonincumbent generators. Lastly, the paper proffered that, from a preliminary evaluation, it appears that southeastern utilities joining a Regional Transmission Organization would likely produce the most benefits compared to other options, especially if it results in a large footprint with diverse resources and customer demand. 

Western Flexibility Assessment

Energy Strategies and Western Interstate Energy Board, December 2019

This study, prepared on behalf of the Western Interstate Energy Board, investigated the flexibility of a future grid in which renewable resources are deployed at levels consistent with enacted and foreseeable public policy requirements of Western states. The report found that “coordinated wholesale markets are effective at increasing system flexibility across the West” and “that it will be very difficult, or at least extremely costly, to achieve Western policy targets without broad coordination of wholesale markets.” 

Problems in Electricity Market Governance: An Assessment

R Street Institute, August 2019

This paper highlighted the reality that the regional transmission organizations (RTOs) play in the U.S. energy economy will continue to evolve and be a matter of fierce debate. While there is no uniform of RTOs’ appropriate role, even among consumers, it is important that RTOs’ decision-making processes should encourage participation and demonstrate transparency. Moreover, it is important that the ultimate decision-makers are geared toward the core public purpose of an RTO—economic efficiency—and not subject to conflicts that lead the RTOs astray from this mission. 

Wholesale Market Barriers to Advanced Energy—and How to Remove Them

Advanced Energy Economy, May 2019

This paper collected 21 case studies of barriers to advanced energy in these markets. The first set of case studies showcases successes in removing or preventing barriers to market entry and participation by advanced energy technologies. These case studies show how proactive Federal Energy Regulatory Commission policies and focused efforts by Regional Transmission Organizations and Independent System Operators and stakeholders can eliminate barriers to market entry and unlock energy technology innovation in the provision of services on the grid. The second set of case studies draws attention to some of the barriers for advanced energy technologies and services that remain. 

The Impacts on California of Expanded Regional Cooperation to Operate the Western Grid

National Renewable Energy Laboratory, February 2023

This report was developed pursuant to Assembly Concurrent Resolution 188, which the California State Assembly and Senate approved in August 2022, and prepared for the California Independent System Operator (CAISO). The report demonstrated that California’s goals for renewable energy and greenhouse gas reduction can be achieved more quickly and with less cost to Californians through expanded regional cooperation.