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EPSA Commends North Carolina Regulators for Launching Inquiry; Calls for Competitive Procurement Requirements to Protect Consumers
WASHINGTON, D.C. - The Electric Power Supply Association (EPSA) today called on the North Carolina Utilities Commission (Commission) to require a competitive solicitation process for all utilities' future electricity supply needs. EPSA filed its comments in response to an investigation opened by the Commission to explore if further guidance or more rules are needed to promote economic and efficient power supply options that best meet the interests of North Carolina electricity consumers.
"EPSA commends the North Carolina commission for opening this proceeding. The state's regulatory leaders are well aware of substantial cost overruns at utility-built power plants currently under construction and rising cost estimates for those being proposed. As states in every region face the prospect of how to meet future supply needs, it is imperative that proper structures and mechanisms are in place to ensure that all supply options are considered in a non-discriminatory manner to the benefit of all customers. Adequate and diverse supply can best be achieved at the most reasonable cost to consumers if there is a fair framework in place for all supply options to be considered, not just those proposed by the state's utilities," EPSA President and CEO John E. Shelk said. "Just as state law requires state agencies to go to bid for goods and services to protect taxpayers, competitive power procurement protects consumers from paying too much for electricity,"
In its comments, EPSA urged the Commission to require competitive power procurement based on best practices for assessing the capabilities and options of all supply options - both those proposed by utilities and those from independent suppliers. "Those best practices should become the foundation for Commission rules requiring that all rate-regulated utilities that propose new generation resources for inclusion in rate base to show that such additional resources were subject to a fair and transparent competitive solicitation process with the use of an independent evaluator," EPSA said. An example of such best practices was submitted to the Commission in a report produced by a collaborative formed by the Federal Energy Regulatory Commission (FERC) and the National Association of Regulatory Utility Commissioners (NARUC), "Competitive Procurement of Retail Electricity Supply: Recent Trends in States Policies and Utility Practices."
EPSA strongly urged the Commission to promptly develop robust rules and protocols for resource supply solicitations given how much utilities are trying to build themselves without competition. "While past forecasts showed a potentially large amount of electric load growth for North Carolina, there is a significant risk of excessive overbuilding in light of proposed energy efficiency programs and the challenging economic situation facing the country. The Commission should require that any utility proposal to add additional resources to its rate base be shown to not only comport with the company's Integrated Resource Plan, but also to be the preferred alternative selected after a fair and effective competitive solicitation process to ensure that consumers receive the best deal possible," EPSA stressed.
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.