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Regulatory Certainty, Competitive Procurement and Improvements to Credit Policies Will Facilitate Investment in Electricity Industry, Says EPSA
WASHINGTON, D.C. - The Electric Power Supply Association (EPSA) today submitted recommendations to the Federal Energy Regulatory Commission (FERC) aimed at keeping capital and credit available to competitive electricity suppliers as they work to meet the nation's demand for electricity in both the short- and long-term. EPSA's comments were submitted as a follow-up to a January 13th FERC technical conference on credit and capital issues.
John E. Shelk, president and CEO of EPSA said, "Regulatory and market certainty is vital to facilitate investment in the electricity industry. We encourage the Commission to take the most important step it can take in today's economic climate - assuring market participants that market rules will not change without a robust, reasoned process. Regulatory certainty, especially in the recently implemented forward capacity markets, is critical and will offer some level of stability to the investment community."
EPSA said forward capacity markets in the PJM Interconnection and ISO-New England were only fully implemented in 2008 and to roll back or replace the current constructs at this early stage would be costly and counter-productive. EPSA also pointed to the FERC/NARUC joint collaborative on competitive procurement as an outstanding example of how FERC and states can work across jurisdictional lines to develop best practices and create more certainty around the competitive procurement process.
Speaking about the panel at the FERC technical conference, Shelk said, "Note the consensus that this diverse panel showed on the negative impact of abrupt policy changes. Participants from all types of markets agreed that rushed changes to market structures could have detrimental effects on investment."
EPSA provided three specific recommendations to address shorter-term credit requirements in the organized markets.
(1) Shortening financial settlement timelines to a one-week period;
(2) Limiting the use of unsecured credit commensurate with the shorter financial settlement timelines; and
(3) Developing a FERC-sanctioned set of best practices to facilitate some standardization of credit policies across RTOs leaving implementation details to individual RTOs;
EPSA's complete filing is available at www.epsa.org under "Recent Filings."
EPSA Comments on Credit and Capital Issues (AD09-2-000)
CONTACT: JOHN SHELK
(202) 349-0154or 703-472-8660
EPSA is the national trade association representing competitive power suppliers, including generators and marketers. These suppliers, who account for nearly 40 percent of the installed generating capacity in the United States, provide reliable and competitively priced electricity from environmentally responsible facilities serving global power markets. EPSA seeks to bring the benefits of competition to all power customers.