Decarbonizing the Generation StackAligning Wholesale Electricity Markets with Environmental Policy

Harvard Electricity Policy GroupOctober 1, 2019

W. Mason EmnettVice President, Competitive Market Policy

What problem are we trying to solve?

1

Sufficiency of Supply

Environmental Impacts

Diversity of Supply

The carbon challenge

2

Source: Fourth National Climate Assessment, U.S. Global Change Research Program (2018).

Decarbonization tools

3

Electrification

Emissions-Free Generation

EfficiencyPTC ITC

CarbonPricing

RPSCES

The New England example

4

White out

Source: Promoting Competitive Power Markets and Growing Zero-Emission Resources in New England, A. Joseph Cavicchi (Nov. 7, 2018)

Source: Achieving 80% GHG Reduction in New England by 2050, Jürgen Weiss and J. Michael Hagerty (Sept. 2019).

The California example

5

Source: Annual Report on Market Issues and Performance, CAISO Department of Market Monitoring (May 2019).

Source: Long-Run Resource Adequacy under Deep Decarbonization Pathways for California, E3 (June 2019).

(Re)Aligning responsibilities

6

Regional commitmentand dispatch

Operationalrequirements

(e.g., ramping needs)

Backstop procurements (e.g., local reliability, resource adequacy)

GenerationMix

RevenueSufficiency

RTO/ISOState(s)