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Electric Power Sector: A Compendium
This Compendium contains a wealth of information on topics including energy tax incentives; energy storage for power grids and electric transportation; privacy and cybersecurity for smart meter data; EPA’s mercury and air toxics standards; lighting industry trends; federal agency authority to contract for electric power and renewable energy supply; potential energy sources qualifying under the Clean Energy Standard; EPA’s proposed rule for cooling water intake structures; and a discussion of whether biopower is carbon neutral.
The electric power industry is in the process of transformation. Since 1978, technology improvements, changes in the economics for generating electricity, and new federal laws and regulations (such as the Public Utility Regulatory Policies Act of 1978, the Energy Policy Acts of 1992 and 2005, the Energy Independence and Security Act of 2007, and Federal Energy Regulatory Commission (FERC) orders, have created a new competitive landscape for electricity. Competition is occurring on the wholesale level, and some states have moved toward retail competition. Other states have retreated from open markets due to concerns over impacts on power prices. Congress continues to face the issue of how much to intervene to ensure a reliable and affordable supply of electricity throughout the United States.
The electric utility system is vulnerable to outages due to system operator errors, weather-related damage, terrorist attacks, and shortages of transmission and generating capacity. The blackout of 2003 in the Northeast, Midwest, and Canada highlighted the need for operations improvements and greater standardization of operating rules. Pursuant to the Energy Policy Act of 2005, FERC named the North American Electric Reliability Corp. as the electric reliability organization required by the act. The ERO is developing mandatory and enforceable standards for the sector to ensure bulk power reliability.
Another provision in EPACT05 required the Secretary of Energy to study congestion on the transmission system. A competitive bulk power market depends on adequate infrastructure. Transmission systems were developed for limited movements of electricity, not the regional power transfers that have become common. Even though transmission of electricity is considered interstate commerce, siting transmission lines remains the responsibility of the states. EPACT05 gives the Secretary of Energy the federal power of eminent domain to obtain rights-of-ways for transmission lines in designated areas if states do not act to site them. Congress is expected to continue oversight on the implementation of EPACT05.
The electric power sector is dependent on adequate fuel supply. The power system has become increasingly dependent on natural gas to fuel new power plants, raising concerns about dependence on a fuel sometimes viewed as supply-limited and subject to price volatility. The most abundant domestic fossil fuel is coal, but the future use of coal is uncertain due to global warming concerns. Greater use of nuclear power may be constrained by the cost of building new plants and the availability of federal financial supports. One answer may be renewable power, but these technologies are still under development and are dependent on federal financial incentives. The resolution of these types of issues, which raise concerns over what kinds of new power plants should be built and how they should be fueled, may ultimately turn on congressional decisions on climate change.
Updated January 30, 2013
THE DOCUMENT INCLUDES FOLLOWING FILES:
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