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Co-Founder and Lead Software Engineer Reliable Energy Analytics LLC

Inventor of patent 11,374,961: METHODS FOR VERIFICATION OF SOFTWARE OBJECT AUTHENTICITY AND INTEGRITY and the Software Assurance Guardian™ (SAG ™) Point Man™ (SAG-PM™) software and SAGScore™...

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  • Sep 7, 2020
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Another attempt to resolve State and Federal frictions in capacity markets dies on the battlefield. It seems to me FERC has already shown it's hand on how to accommodate "Green" resources to meet State energy goals: "In a competitive market, where neither buyer nor seller has significant market power, it is rational to assume that the terms of their voluntary exchange are reasonable, and specifically to infer that the price is close to marginal cost, such that the seller makes only a normal return on its investment.” Tejas Power Corp. v. FERC (1990). "

Which is why the Always on Capacity Exchange (AOCE) design employs an exchange model for price discovery, eliminating price distortions, and clears the market based on resources needed for essential reliability services, after acquiring green resources needed for State energy policies and Green buyer needs. Green resources and essential grid services resources clear separately to avoid price distortions.

AOCE Overview

Detailed Description of AOCE

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Bob Meinetz's picture
Bob Meinetz on Sep 7, 2020

"The Commission’s approach is both deeply misguided and will ultimately doom NYISO’s current capacity market construct by forcing New York to choose between the Commission’s constant meddling and the state’s commitment to addressing the existential threat posed by climate change."

Richard, it's Richard Glick who is deeply misguided if he believes NYISO's approval of shutting down Indian Point Energy Center reflects a "commitment to addressing the existential threat posed by climate change." Instead, it represents a commitment by Governor Cuomo to enriching state gas and renewables interests at the expense of environmental health - nothing more, nothing less.

But why is Glick making statements like this anyway? He has no business meddling in New York environmental policy. In fact, he's specifically prohibited from doing so by FERC rulings from over a decade ago. In 2007 the commission recognized each state has unique priorities with respect to environmental policy, and ruled it should - and would - be entirely under state purview.

Meanwhile, AOCE proponents attempt an end-around by proposing to

"...clear the market based on resources needed for essential reliability services after acquiring green resources needed for State energy policies and Green buyer needs..."

Put green buyers' needs before system reliability? I don't think so. Because their needs aren't rooted in science as much as astrology, green buyers might have to find inner peace and tranquility from eating more oat bran, rather than wasting public money on wind turbines and solar panels.

Indian Point is the best of both worlds: reliable power and no carbon emissions. Both unreliable, and 100% dependent on gas backup power, renewables are the best of neither. Renewables policy is designed to win feelgood votes from feelgood voters while shooting legitimate efforts to address climate change in the foot.

Here on the Left Coast, pro-renewables influence is so ensconced in state legislature that Californians for Green Nuclear Power, Mothers for Nuclear, and other groups opposing the shutdown of Diablo Canyon Power Plant are now turning to FERC for help in keeping the plant open - on reliability / antitrust issues. With hot weather draining California's reservoirs of available gas, and daily blackouts, the timing couldn't be better.

Richard Brooks's picture
Richard Brooks on Sep 8, 2020

Bob, There's a good reason why green resources are acquired first in AOCE: This is done so that a system operator can decide where/when/what type of essential grid services will be needed, based on the distribution of these green resources. For example, suppose an operator has an abundance of solar resources clusterd in an area of the grid, the system operator would need to know this risk so that they could acquire more ramping resources in that area in order to handle the swings that comes with solar generation. An operator cannot plan a reliable system without knowning where the risk to reliability exist - only then can they decide what services are needed to maintain reliability. Nuclear is indeed a valuable and reliable green resource.

Bob Meinetz's picture
Bob Meinetz on Sep 18, 2020

"An operator cannot plan a reliable system without knowning where the risk to reliability exist - only then can they decide what services are needed to maintain reliability."

Richard you know, and I know, that the risks to reliability are solar and wind power.

In 10-20 years, small modular reactors will begin to take the place of wind+solar+batteries+AOCE+gas plants+efficiency+TOU pricing+demand response+distributed generation+[insert yet-to-be-discovered renewable band-aid here]. Because they're designed so modules can be shut down and restarted individually, they'll be perfectly capable of following the extremely-reliable curves of consumer demand. It won't be in the U.S., however - it will be in China, Russia, India, and other developing countries, where vested fossil fuel interests aren't calling the shots.

In 30 years Ford, GM, Apple, Google, and what's left of U.S. manufacturing will be buying micro-reactors from China to power their plants. But because they're dependent on fuel and maintenance from foreign interests, U.S products will be more expensive, and will face stronger headwinds in foreign markets.

Unregulated consumer electricity in the U.S. will be prohibitively expensive, and 100%-dependent on natural gas. For more consumers, basic electricity service will become an unaffordable luxury. Without reliable, affordable energy to power their cars, to cook their food, wash their clothes, etc. etc. etc., desperation will build, and democracy itself will become increasingly unreliable in the U.S.

It would sound like a dystopian fantasy if we weren't already halfway there.

Gene Nelson's picture
Gene Nelson on Jan 25, 2021

As Californians for Green Nuclear Power, Inc's (CGNP's) Legal Assistant, I personally remain concerned regarding the outcome of FERC Docket EL21-13, regarding the reliability benefits of Diablo Canyon Power Plant (DCPP) in the face of foreseeable California-specific hazards involving the California natural gas bulk transmission system. On January 21, 2021, Glick became FERC Chair. Will FERC side with astrology (see comment below) or science, engineering and statutory authority?

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