If your company operates in more than one state, or electricity grid, you might also be operating in both regulated and deregulated energy markets. When you are making decisions about purchasing energy, it is important to know the difference between these markets and develop a plan that will make sure your company gets the right renewable energy solution.
Electricity markets are highly diverse.
In a regulated electricity market, vertically integrated monopoly utilities cover the entire value chain with oversight from a public regulator. The utility makes sure that power is generated, sent to the grid, and reaches customers. Customers in regulated markets cannot choose who generates their power and are bound to the utility in that area. Regulated markets dominate most of the Southeast, Northwest and much of the West (excluding California).
In a deregulated electricity market, market participants other than utility companies own power plants and transmission lines. In such instances, generators (companies that generate electricity) sell electricity into a wholesale market, and retail energy suppliers purchase this electricity to sell it to customers. Transmission companies or utilities own and operate the transmission grid. This market universe is managed by an independent system operator (ISO) or regional transmission organization RTO. Your utility company is still around – It makes sure the power is distributed and everything is working correctly to keep your lights on.
Deregulated markets have opened up generation for competition from independent power producers in 24 states, such as California, Texas and most states in the Northeast. 18 of these states and Washington D.C. have also introduced retail choice, which allows residential and/or industrial consumers to choose their own electricity provider. Customers benefit from more competitive rates and generation options, including renewable energy.
It is important to note that the market is not split clearly between regulated and deregulated states. Some states, like California, are partially regulated markets. This is due to the nature of the grid, historic reasons and the geographic boundaries of utility territories in neighboring states.
So, your company wants to get renewable energy. What does this mean?
As part of the Renewable Energy Buyers Alliance (REBA), World Resources Institute recently launched a Corporate Strategy Map to help corporations identify some renewable energy solutions (mainly retail choice options and utility green tariffs) in different states.
Still, if your company is located in a regulated state, developing a large-scale renewable project inside your state and claiming renewable energy use is challenging, and may not be possible at all. In regulated states, most renewable energy projects are utility-owned. Furthermore, few utilities offer green pricing programs that fully meet the Corporate Buyers Renewable Energy Principles of cost-effective and impact renewable power.
The good news is that even if you are located in a regulated state you can still engage in renewable energy, either on your own or aggregated with other organizations. Your company can use “indirect” physical or financial contract structures by entering into a Power Purchase Agreement (PPA) with an offsite project located outside your state. Your company can then claim the benefits of this renewable energy by retaining ownership of project-specific renewable energy certificates (RECs). Your existing grid power supply arrangement will stay in place, while your company is helping green the grid in the U.S. and receiving environmental and economic benefits from a renewable energy project.
If you are located in a deregulated state, there are more options, some of which include incorporating renewables directly into your retail supply contract. Your organization can also aggregate demand with others to create a larger impact project than you would have accomplished alone. Furthermore, in a deregulated state, there is increased flexibility around the structure of the contract, the location of the project, and the scale of selected renewable source.
Bottom line: The value proposition associated with large-scale renewable energy projects – lower costs, reduced future price risk, lower GHG and other strategic benefits – is available, no matter the regulatory regime for your organization’s U.S. footprint.
|California||Deregulated for some commercial & industrial consumers*|
|District of Columbia||Deregulated|
|Georgia||Deregulated for some commercial & industrial consumers*|
|Michigan||Deregulated for some commercial & industrial consumers*|
|Oregon||Deregulated for some commercial & industrial consumers*|
|Virginia||Deregulated for some commercial & industrial consumers*|
*States may be partially regulated/deregulated, regulated only in some utility markets, or deregulated for industrial consumers. Additional information available at the American Coalition of Competitive Energy Suppliers.Read More
The advancement in technology has made it possible for scientists to come up with innovative solutions. From expeditions to the moon, discovering possible life and resources on other planets, exploring the vast galaxies, mankind has come a long way. The earth is a planet of immense beauty and resources. Some of these resources include: fossil fuels, coal, natural gas, oil and water. These resources are valuable because they are used for various purposes. But one of the most important aspects is their ability to produce energy to generate electricity for homes.
Water is an incredible source of energy. However, its purpose is not limited to this. It is used for heating, cooking, cleaning, and fueling cars, as well as various other purposes. Despite being considered renewable energy at one point, these resources are now diminishing. Constant use has been detrimental to the resources. Furthermore, a study published indicates that by 2025, 1.8 billion people will suffer from scarceresources of water.
How Solar Energy is the Sollution
Through technology and scientific research, scientists have been able to successfully find ways to conserve finite resources. They have been able to discover alternates to renewable energy. One of these is solar energy. By combining modern day technology and sunlight, the production of solar energy has become a possibility.
Large solar panels are used to absorb the powerful solar rays emitted from the sun and convert these into power resources used to light up residential and commercial areas.
Wherever you go, no matter what the weather, always
bring your own sunshine
Due to scarcity, inflation has led to energy costs rising. Furthermore, the use of hydro-generated electricity and fossil fuels has led to excess energy being produced. This leads to over-billing for electricity that is not used.
Net metering has become possible through solar panels. When energy is produced through these panels, it is directly converted from sunlight. Therefore, there is no wastage of water and excessive production is not problematic. This is because net metering allows organizations and businesses to reserve the energy and distribute it.Read More