Analysis

State-Federal Rift Pushes Power Markets To Breaking Point

Law360 (May 10, 2018, 4:36 PM EDT) -- Backlash against regional grid operator PJM Interconnection LLC's recent proposal to blunt the impact of state subsidies for clean energy in so-called capacity markets where power producers are paid to meet future demand highlights growing tensions between state and federal electricity policies that have experts questioning whether these markets have a viable future.

PJM, which oversees the grid in 13 Mid-Atlantic and Midwest states and Washington, D.C., last month urged the Federal Energy Regulatory Commission to approve one of two proposed overhauls to its capacity market: a two-stage auction where subsidized power sources first compete against each other before competing against...

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