Protecting power plant owners from clean energy policies may have a perverse result

FORBES | U.S. electricity markets have long operated under an illusion of being perfectly competitive. Federal and state regulators, power plant owners, and consumer groups all pledge allegiance to the idea that competitive markets will result in fair prices for electricity and fair returns for producers. But the truth is U.S. electricity markets have never met the economic ideal of perfect competition, and now a federal regulatory order may fundamentally reshape the nation’s largest wholesale electricity market in the name of this illusion.


The stakes are high because electricity customers in states with aggressive clean energy targets could see drastically increased costs as a result of the Federal Energy Regulatory Commission’s (FERC) directive to the regional organization that coordinates the movement of wholesale electricity between 13 Eastern and Midwestern states and the District of Columbia, the PJM Interconnection.


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