January 14, 2015: Legislative Preview Meeting
Each year we hold this preview of the 2015 legislative session jointly with the Energy, Public Utility and Communications Section of the Connecticut Bar Association. Our speakers will be the leadership of the General Assembly’s Energy and Technology Committee which oversees the state’s energy law and policy. 5:30 PM, Courtyard by Marriott, Cromwell, CT.
Click here to register.
December 10, 2014: CPES Holiday Party with Commissioner Klee
On December 10, 2014, CPES held its annual Holiday Party with special guests Robert Klee, Commissioner of the Department of Energy and Environmental Protection (DEEP), and Tracy Babbidge, Bureau Chief for DEEP’s Bureau of Energy and Technology Policy. Commissioner Klee provided a broad overview of Connecticut’s energy policies, focusing mainly on the state’s first-ever Comprehensive Energy Strategy (CES) released by DEEP in February 2013. Tracy Babbidge provided a deeper dive into DEEP’s more recent activities, particularly its work on the latest Integrated Resources Plan (IRP), which looks at both demand-side resources (conservation, energy efficiency, etc.) as well as more traditional supply-side resources (generation, transmission, etc.) in making its recommendations on how best to meet future electricity needs in the state.
Commissioner Klee spoke of the many goals contained in the CES, particularly its mission to move the state toward a “cheaper, cleaner, and more reliable” energy future. Commissioner Klee highlighted the work of the Connecticut Green Bank, a clean energy finance and investment authority which leverages public and private funding to drive investment in renewable energy in Connecticut. Emphasis is placed not on “picking winners,” Klee explained, but on using competitive processes to select the cheapest sources of clean energy for the state. He also highlighted the state’s expanded energy-efficiency programs, noting that every dollar spent on energy efficiency leads to over two dollars in savings on customers’ energy bills. Commissioner Klee also touched on the strategy’s goal to expand the natural gas distribution system to give consumers more energy options for heating their homes. He concluded that while Connecticut has made significant progress in the energy sector, challenges remain, particularly concerning the region’s lack of adequate energy infrastructure to meet the demand for natural gas during winter peaking conditions. He noted that in the face of this regional problem, the New England states need to work together to find a regional solution.
Tracy Babbidge, Bureau Chief for DEEP’s Bureau of Energy and Technology Policy, focused her remarks on the agency’s latest Integrated Resources Plan (IRP), which was released in draft form on December 11, 2014. The IRP, last issued in 2012, assesses the state’s energy needs and sets forth a plan for meeting those needs through both demand-side and supply-side resources. The energy landscape looks very different now than it did in 2012, she explained, with major generator retirements announced in the last couple of years and significant amounts of renewable energy added to the system. She highlighted the plan’s key recommendations, which include a regional approach to issues surrounding energy infrastructure and increased support for energy efficiency, distributed generation, and combined heat and power (CHP). She also touched on Connecticut’s desire to step up advocacy on energy issues at the federal level, particularly in proceedings before the Federal Energy Regulatory Commission (FERC) and the U.S. Environmental Protection Agency (EPA). Grid modernization is another area of focus in the IRP, which recommends a proceeding to address the need for a modern grid that accommodates a wide array of technologies and resources. The draft IRP will be subject to a 60-day public comment period, after which the agency will issue a final version.
November 12, 2014: Procuring Retail Supply in a Volatile Electricity Market
On November 12, 2014, CPES hosted Anne George, Vice President of External Affairs and Corporate Communications for ISO New England, Michael Coretto, Vice President of Regulatory Affairs for UIL Holdings Corporation, and Taff Schamler, Chief Operating Officer for North American Power, to discuss power system operations last winter and procuring retail supply in a volatile electricity market. State regulators and utilities in New England have announced significantly higher retail electricity rates that will take effect this winter due in large part to the high wholesale electricity prices the region experienced last winter. The panel discussed the impacts of natural gas pipeline constraints and how utilities and competitive suppliers manage the risk of procuring supply in the wholesale electricity market.
Anne George provided a regional perspective on what’s driving prices in the wholesale electricity market. She discussed the region’s dependence on natural gas for power generation and the challenges ISO New England faced last winter during colder-than-normal weather conditions. Because of natural gas pipeline constraints, New England experienced sustained high natural gas prices and, in turn, sustained high wholesale electricity prices. George also provided an update on the 2014-2015 Winter Reliability Program and market enhancements intended to improve power system operations this winter. She explained that recent market enhancements will improve long-term resource adequacy and performance, but they may not result in much-needed energy infrastructure investments throughout the region.
Michael Coretto of UIL Holdings explained how local distribution companies procure gas supplies for their customers. He noted that given the projected supply and demand forecast for this winter, he expects there will be no deficiencies in meeting peak day requirements. He also provided the perspective of a regulated electric distribution company that procures supply on behalf of standard service customers who have not chosen a competitive supplier. He explained that the overarching principle is “laddered” procurements, which dampens the impact of price spikes in the wholesale electricity market through multiple power procurements for a given delivery period. He noted that expectations for another cold winter and vivid memories of winter 2013/2014 have led to much higher retail electricity rates for the first half of 2015.
Taff Schamler of North American Power spoke from the perspective of a competitive retail supplier buying in the wholesale market. He explained that due to natural gas pipeline constraints, New England gas prices this winter are four to five times higher than most areas of the United States, causing large premiums in power prices compared to other regions. According to Schamler, the impacts on competitive suppliers can be severe, and include not only financial losses and reputational damage, but even exits from the business. In response to last winter, Schamler explained that North American Power has adjusted its products and plans, adjusted the way it hedges, and diversified its business outside of the volatile conditions in New England.
Click here for a copy of the presentations.
October 8, 2014: What’s the Deal? 21st Century Energy Joint Conference
In his 2015 energy forecast, delivered at this year’s 21st Century Energy: What’s the Deal conference, DEEP Commissioner Robert Klee noted that with a “cheaper, cleaner domestic energy supply just 90 miles away,” his agency is aiming for 50% natural gas penetration in Connecticut to achieve parity with neighboring states. Commissioner Klee’s comments was only one of the many highlights from this annual conference that CPES and CBIA co-host.
He acknowledged, however, that natural gas is not a viable option for the foreseeable future in half the state, “which is why need to keep pursuing energy efficiency…and driving down the cost of alternatives.”
Noting that “there are limits to what consumers can and will pay,” Klee called for leveraging more private capital to reduce subsidies—crowdsourcing, the Groupon approach, and other innovative ways to encourage deployment at scale.
In additions to the Commissioner’s address, attendees also heard from energy leaders such as Heather Hunt, Executive Director, New England States Committee on Electricity, Bryan T. Garcia, President and CEO, Connecticut Green Bank, Kevin R. Hennessy, Director Federal, State & Local Affairs – New England, Dominion Resources, Inc., and James G. Daly, Vice President Energy Supply, Northeast Utilities. Hannah K Bascom, a Business Development specialist at Nest Labs gave the afternoon keynote address.
The day’s program ended with a panel made up of Connecticut news reporters and their take on the impact energy policy on the November, 2014 elections.