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Tuesday, August 30, 2005

Like Motherhood and Apple Pie
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Reliability in electricity is like motherhood and apple pie. It's hard to be against it. This is why the provisions in the Energy Policy Act of 2005 that give FERC new authority to regulate in the name of reliability were very broadly supported. There were, however, a few of us lonely souls who suggested this might not be such a good idea, because virtually anything can be done in the name of reliability. Now, while the ink is barely dry on the President's signature, we see confirmation for our concerns. FERC Commissioner Nora Mead Brownell, going boldly where others might fear to tread, said in an interview last week: "This is a chance to change the world." She added, "People will be surprised how comprehensive" the upcoming notice of proposed rulemaking on reliability will be. Of course, rather than promulgating a costly new regulatory regime in the name of reliability, we should be moving toward a more competitive system in which power producers have market-based incentives to provide the right level of reliability. Sadly, we don't seem to be moving in that direction. Hopefully, Commissioner Brownell's comments do not reflect the views of her colleagues on the Commission. We will stay tuned.

posted by Tom Lenard @ 6:01 PM | Electricity

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