For some people, when they think of coal mining, they think of men covered in dirt with pick axes, putting the coal into a cart which will be pulled to the surface by a mule with constant danger
Pennsylvania’s electric deregulation began in August 1997 with the roll-out complete by January 2000; it was initially slow to be adopted in the rural parts of the state. Many people were very loyal to their power companies for decades and did not understand the actual meaning of deregulation. People were worried that if they switched generating companies than they would not have the friendly and reliable service they had grown to love. Their biggest fear was the reliability of the grid as a result of the deregulation failure in California caused by Enron. In my area, Penn Power is the dominant provider. Almost everyone has it and/or knows someone who works for it. People in return are quite loyal to them. What people do not often realize is that Penn Power does not set your rates for generation; those are set by a different company. The choice of a different supplier will not change the service Penn Power provides to you as customers and the bills will still come from Penn Power. Energy suppliers are attempting to lock in their future revenue by offering steep discounts, so that they can show their investors that they have a certain amount of business guaranteed at a predetermined rates. The companies have became leaner as a result of the free market allowing them not to be as inefficient as they once were allowed to be when regulated. Free markets cut the fat out of companies as a result of the fight or flight mentality it creates. A company’s profitability is now determined as a matter of the free market instead of a regulated rate. Economist Thomas Sowell puts it best when he states, “The desire of businessmen for profits is what drives prices down unless forcibly prevented from engaging in price competition, usually by governmental activity.”[i] Deregulation will cause the companies to exercise caution concerning future investments in order to limit lost money on deserted projects (such as partially completed nuclear power plants). Some people believe that regulation and deregulation are a cyclical system, but it is cyclical as a result of failures in human nature, not as a result of the system.
James H. Cawley, Chairman of the Pennsylvania Public Utility Commission is a proponent of deregulation as he states, ““I’ve regulated under the old way and under the new way, and this is so much better” because “you don’t make your customers captive to the inefficiencies and cost overruns of the power plants,”[ii]. The interesting thing with the dawn of the internet is that finding the cheapest supplier can sometimes be as easy as a Google search away because of sites like http://www.papowerswitch.com. Some of the rates are fixed and some are variable. There are pros and cons to both types of rates to the consumer and to the companies. The companies are willing to offer a cheaper rate for the fixed because they know they have a guaranteed source of income for the entire period of the rate lock, which allows them to be confident about future revenue at investor meetings.
There appears to be some fly by night power suppliers on these sites that offer quite low variable rates, but very few people in the public truly know why their rates are so low. Are they being subsidized by the government; do they have a truly great product, or both. They tend to also have a large percentage of renewable, which to me just means more expensive. Since renewable power currently costs about four times more than traditionally sourced power, the higher the percentage of renewable power, the higher the blended power cost for that supplier. If they are subsidized, when do the incentives go away causing the rates to inevitably balloon.
Of course, the residential users are not as quickly adopting the perks of deregulation as are the commercial/ industrial users. Commercial/Industrial users tend to be more business savvy than the average residential customer. They also have greater electricity needs and price sensitivity than the average residential consumer. ”Commercial and industrial customers, who have the largest electricity bills, have switched at a greater rate than residential customers. The breakdown for those going to alternative suppliers among the PPL customer classes are 97 percent for industrial, 83 percent for commercial and 40 percent for residential. Alternative suppliers in the state have grown from 49 in 2009 to 170.” Commercial and industrial customers, who have the largest electricity bills, have switched at a greater rate than residential customers. The breakdown for those going to alternative suppliers among the PPL customer classes are 97 percent for industrial, 83 percent for commercial and 40 percent for residential. Alternative suppliers in the state have grown from 49 in 2009 to 170.”[iii]
My parents recently renewed with their own power supplier at a drastic discount because our local supplier had a friends and family rate. My mother was handed a card by a close family friend and upon going to the website the new rates were made known to us. You could leave your rate as variable, but still at a lower rate then was currently being paid, or you could have it fixed for 3 years at an even lower rate, or you could rate lock for 7 years at the lowest rate. After, some discussion we decided to rate lock for three years because who knows what the energy market will look like in 7 years. I was trying to hedge my gains and possible future losses just like any smart business tries to accomplish. The normal residential consumer doesn’t understand the concepts of hedging and they tend to prefer not to be married to a particular supplier for long periods of time.
The interesting component is that with so much uncertainty in the industry as a result of the shale craze who knows what will happen to electricity rates. Even though we have an abundance of energy what if Congress mandates a clean fuel imitative and causes the price of electricity to skyrocket putting companies that rate locked at a great disadvantage. Other nations throughout the world have required a huge amount of their nation’s electricity to be renewable and to not use fossil fuels. The problem is fossil fuel is still one of the cheapest ways to generate electricity. The future of electricity rates is unknown as a result of the possibility of a Congressional mandate. Deregulation of the electric industry will only fail as a result of government intrusions into the free market.
Society has become completely dependent on electricity. Natural resources and the fossil fuels we use will one day run out. Hydro, wind and solar energy is sustainable, but there are serious doubts as to the likelihood that these sources will be able to provide enough electricity in the future to meet our demands. With this in mind, developing new and electricity-efficient homes, devices and transportation is crucial to the future. The world population is steadily increasing and even developing countries are starting to need an increasing amount of electricity to power their homes, transportation and the plethora of devices that we use. The development of energy efficient technology in our home is a good start, and the United States government has taken an initiative to combat the need for more electricity in starting the Energy Star program.
The Energy Star program began in 1992 under the Environmental Protection Agency through part of the Clean Air Act. In 2005, there was a push from Congress to promote the development and energy efficient products and homes. Together with the Department of Energy, the EPA has encouraged companies to increase overall energy efficiency, decrease energy pollution and increase energy security. It provides incentives and tax breaks for producing energy efficient technology, but does not regulate the market.  If the government continues to improve on the Energy Star program it could force technology that could make our homes efficient enough that each home could provide its own electricity using renewable resources. The EPA has already begun to promote the building of Renewable Energy Ready Homes that make is easier for individuals to install solar panels to power their entire homes and cars. 
Complete Thermal Enclosure Systems are the first step in making a home energy and electricity efficient. Air conditioning is the norm in most parts of the country and more people install air conditioning units each year, which run all summer long and run up electric bills. Making homes sealed and insulated keeps the cool air in and the hot air out, which means air conditioning units run less and use less electricity. The concept works the same in the winter when heating is required. The process is quite simple and can go a long way in saving electricity. Requiring new homes and businesses to follow steps to increase efficiency could go a long way in reducing demands for electricity. Forcing advances in building technology is just one way to significantly reduce energy use. 
The next step is developing appliances and devices that use less electricity. By now everyone has seen appliances and televisions with the Energy Star sticker, which is a mark of meeting the highest efficiency standards. The one appliance in our home that has seen the a huge change because of Energy Star is the washing machine. In the past 20 years the Energy Star program has helped washers use 70% less electricity and 75% less water. In addition to washers, lightbulbs, refrigerators, water heaters, air conditioners, furnaces, microwaves and practically anything that uses electricity has conformed to meet the standards of the Energy Star program.  These are all encouraging signs for the future of energy efficiency, but to meet our electricity needs for the future, standards need to continue to increase in order to force technology in the right direction.
Seeing the effectiveness of the Energy Star standard system, the EPA decided to make its standards even more rigorous in 2012. For example, new Energy Star homes must be 15% more efficient than past years.  It is an encouraging sign to the future of the Energy Star program, but more importantly for the future of electric efficiency – a necessary part of our future across the globe. Energy Star is a model program for energy policy in that it provides incentives rather than regulations, and has brought about desirable results.
Then again, there are other alternatives to electric efficiency…
 see footnote 1
Recently, the Subcommittee on Energy and Power (“Committee”) met to continue their discussion on the role energy diversity plays in ensuring affordable and reliable electricity for American Consumers. Electricity production in the United States derives predominantly from coal, natural gas and oil, nuclear power, hydropower, and renewables. The Committee has emphasized an “all-of-the-above” approach when determining how to meet the nation’s diverse energy needs. Each source can serve a purpose in the electricity mix and each has strengths that can compensate for the others’ weaknesses.
The U.S.’s electricity generation is currently experiencing a shift driven largely by low natural gas prices and new regulations on the power sector. Power generation varies based on regional geographies. It is unlikely that only one energy policy will work for the entire broad energy sector of the United States. Coal largely dominates the electricity production in the United States, but in the Middle Atlantic Region, nuclear generated electricity (35%) is consumed more than coal (27%), or natural gas (27%). In the Pacific Region the predominant electricity produced comes from Hydro Power (47%). Every source of electricity has its advantages and its disadvantages. Each source also varies in cost, economic and environmental impact, and other factors. The Committee agrees that sound energy planning means that there is not one source which is relied upon to produce electricity. The Committee has determined that the federal government should encourage an all-of-the-above approach to electricity production that takes advantages of the diverse and affordable domestic energy sources and technologies. 
With new sources of electricity generation emerging and being utilized across the United States, each state has to decide which method or combination of methods it wants to implement to produce its electricity. Energy resource diversity in the electric sector is important to any region. Having a range of electricity generation sources increases grid stability, reduces consumers’ exposure to price spikes, and makes policy changes easier to handle. While resource diversity is valuable, it is often used in a negative context to protect the status quo or argue against renewable energy portfolios.
There has been a rise in governmental considerations under the context of electricity generation. The federal and state governments generally favor a diverse energy mix, but maintain that the best methods of achieving this are through private market driven forces and not via a government mandate. The current market heavily favors the use of traditional sources of electricity generation including coal, natural gas and oil and has been reluctant to get behind other sources of energy generation.
When comparing energy diversity state by state, the market concentration of a certain industry and also the economic diversity of the market must be considered and compared. The Energy Information Administration compiled some data to compare each state’s energy diversity from 1990 up until 2011. The states with the most electricity generation diversity are New York (1), California (2), Alabama (3), Maine (4), and Arizona (5). The states with the least amount of diversity are Rhode Island (51), West Virginia (50), Kentucky (49), Wyoming (48), and Indiana (47)(the District of Columbia was considered). Pennsylvania ranks ninth (9th) in energy diversity for electric production. The closer the HHI index is to 0.00, the more diverse the electricity supply of that specific state.
Renewable energy sources have significant relevance to the future of the global electric supply. One of the largest challenges facing the electric industry is to design a new market in order to be more competitive with other energy sources such as solar and wind power. Traditional utilities are being forced to change their business model – “Tomorrow’s smart utility, the iUtility, must no longer see itself as just in the electricity business but must become a full service energy provider selling a variety of products and services including energy efficiency.” Joseph P. Tomain and Richard D. Cudahy, “Energy Law in a nutshell” (2nd edition 2011).
Seemingly aware of these demands on tomorrow’s utilities, between 2008 and 2012, the U.S. doubled its renewable electricity generating capability, based on a report published in January of 2013 from Bloomberg New Energy Finance and Business Council for Sustainable Energy. http://thehill.com/blogs/e2-wire/e2-wire/284011-renewables-comprise-all-new-us-electricity-capacity-added-in-january.
As of January 2012, wind and solar power had proven “uncooperative” in producing renewable electricity, according to an article published by the American Enterprise Institute. With wind and solar power currently producing only 3.6 percent of U.S. energy, the small market share suggests “inherent limitations” that can only be overcome at high costs. http://www.aei.org/outlook/energy-and-the-environment/alternative-energy/wind-and-solar-power-part-i-uncooperative-reality/. Biomass, geothermal, and hydropower are also seen as potentially viable sources of renewable electricity. http://www.buzzle.com/articles/renewable-sources-of-electricity.html.
However, the trend appears to be moving positively in a more cooperative direction, as renewables constituted all new electric capacity added in the U.S. in the month of January 2013. http://thehill.com/blogs/e2-wire/e2-wire/284011-renewables-comprise-all-new-us-electricity-capacity-added-in-january
Perhaps President Obama is hoping these costs are not prohibitive of developing the renewable electricity market. The President pledged during his State of the Union to double electricity generating capacity from renewable energy by 2020. In an attempt to show he is serious about this initiative, the President recently revived the Commerce Department’s Renewable Energy and Energy Efficiency Advisory Committee. http://thehill.com/blogs/e2-wire/e2-wire/284011-renewables-comprise-all-new-us-electricity-capacity-added-in-january. President Obama’s initiatives born today will have gone a long way if the U.S. can actually reach 80 percent renewable electricity by 2050. http://www.technologyreview.com/view/428284/the-us-could-run-on-80-percent-renewable-electricity-by-2050/. The President, having spoken of America’s aging infrastructure in the past, must take a hard look at our power transformers, which hold an average age of 42 but were only designed to last 40 to 50 years. (one source describing America as a “superpower with a third-world grid”) http://www.thedailybeast.com/articles/2011/09/09/major-power-outage-shows-weakness-of-aging-electric-infrastructure.html.
Government, industry, and consumers collectively must be cognizant of both the pluses and minuses of investing huge sums of capital and resources into the development of alternative, renewable energies. Opposing voices will emerge with an underlying agenda that may not be in the best interest of consumers (i.e. lobbyists). The best way to grab the attention of voters and garner opposition is to claim loudly taxes will rise as is the case with the Heartland Institute and ALEC. http://www.skepticalscience.com/print.php?n=1743. Usually they will loudly proclaim something will cost “x” billions of dollars (which just sounds bad to the average American voter).
Change is required and soon. Global electricity demand is expected to rise 70% between 2010 and 2035, according to the International Energy Agency so it is critical government and private industry together assess the current ability to meet those needs. http://www.albawaba.com/business/electricity-demand-451632. New ideas and innovations come with risk that can be easily magnified to induce skepticism, possibly even irrational fear. In the 21stst century, the risk of exploring and developing renewables, which carry the strong potential benefits of cleaning up our environment while also helping to ensure global electricity demand is met, may prove not all that risky after all. The future of electricity is very much tied to renewable energy sources and worth the aggressive pursuit of achieving 80% of electricity production through renewable sources by 2050.
Clean energy. It’s what everyone wants or at least, it’s what everyone is talking about. Last month Senator Jeff Bingaman (D-NM) attempted to put pen to paper by introducing the Clean Energy Standard Act of 2012. This legislation attempted to modernize the power sector to generate more electricity with cleaner energy.
The Clean Energy Standard Act of 2012 (CES) presented a market-based approach that encouraged and promoted several forms of electricity-generating technologies. The whole purpose of CES was to set a national goal for clean energy by establishing a framework that allows resources to compete based on how clean they are. 
The Act works to provide all generators of clean energy credits based upon their carbon emissions. Those industries with lower carbon emissions such as solar, wind and nuclear, are given a greater number of credits for their lower emissions per unit of electricity. The framework also encouraged energy producers to use a wide variety of sources to meet the standard. A generator would be considered clean when it has a zero-carbon source of energy. Finally, the market would be used to determine the optimal mix of technology and fuels, so as to allow for the creation of new technologies. The specifics of the Act are as follows:
- Beginning in 2015, each utility covered under the bill must obtain a certain amount of electricity from “clean” sources. That obligation increases each year, so that in 2035 covered utilities must supply 84% of their total annual sales of electricity from clean sources.
- Covered utilities can generate electricity from clean sources to meet the electric demands of their consumers, or they can purchase tradable credits from other clean sources.
- Covered utilities that do not generate electricity from clean sources or purchase credits from other clean sources may also comply by paying a fee, known as an alternative compliance payment. That payment starts at 3 cents/kWh in 2015, and annually increases by 5% plus the rate of inflation. 
Perhaps the most interesting part of the Act is another incentive that rewards industries for being energy efficient. Under this program, generators that produce heat and electricity that are capable of capturing the heat to be used for other purposes are treated as “clean” under the Act. The purpose of this program was to help increase generator efficiency as well as to provide another inexpensive and clean energy source. It is hard to project what the cost would be for some of these generators to update their machines to better utilize the heat generated, but this does not seem like an unreasonable update.
According to Bingaman, CES ensures “that as we continue to grow and power our economy, we leverage the clean resources we have available today, and also provide a continuing incentive to develop the cheaper, cleaner technologies that we’ll need in the future. We want to make sure that we drive continued diversity in our energy sources, and allow every region to deploy clean energy using its own resources. And we want to make sure that we do all this in a way that supports home-grown innovation and manufacturing and keeps us competitive in global clean energy economy.”
It is important to note that the Act does not put a limit overall emissions or the growth of electricity generation. It also alleged that it neither raises nor costs the federal government any money. Rather, should any funds be generated from the incentive program, the money is supposedly funneled back into the state from which it was generated to fund further energy programs. The exclusive purpose behind the Act is to promote cleaner energy production. While these appear to be the guarantees of the Act’s supporters, opponents of the Act argue that it will have the effect of driving up electricity rates.
Senator Bingaman hoped this Act would double clean energy by 2035. Unfortunately, however, after it’s introduction, there was not enough support for it to pass to the Senate floor. The bill now remains with the Senate Energy and Natural Resources Committee. While this Act will likely have many hurdles to overcome before is gains bipartisan support, one thing is clear: everyone wants clean energy; nobody wants to pay for it.
For many years we have heard about electric cars that will save us all from ever rising gas prices. Today these cars are finally becoming main stream with major car companies rolling out new models every year.
The four most common types of electric cars are hybrids, plug in hybrids, extended range vehicles, and battery electric cars. The hybrid is probably the most familiar and has been available to consumers since 1999. Hybrids still have the traditional internal combustion engine; however that engine is supplemented by a small electric battery making these cars are about 25% more fuel efficient than similarly built combustion engine powered cars. The electric engine assists the combustion engine during acceleration and cuts it off entirely when the car is idling; this assistance makes it possible for the cars to have smaller, more fuel efficient combustion engines. The electric engine is recharged both by the combustion engine and a system of regenerative braking that utilizes kinetic energy expended as the driver brakes.
The plug in hybrid is the same basic concept as the hybrid, it just has a bigger battery that helps to further reduce fuel use. Like the hybrid, the battery may be charged through the combustion engine and regenerative braking, however it also can be plugged directly into a standard 120 volt power outlet at the owner’s home to help to recharge the larger battery.
The extended range electric vehicles (EREVs) also have a combustion and electric engine; however the combustion engine is only used to revive the electric engine once it has lost its charge. The Chevy Volt is an example of this kind of electric car and uses no gas for the first 35 miles. After the battery has used up its charge, the combustion engine kicks in and the car will get about 37 mpg.
Finally, the battery electric cars have taken out the combustion engine all together. Therefore the batteries must hold a much larger charge and a nonstandard 240 volt power outlet is recommended to enable speedy charging. The car can run about 80 miles on a single, full charge. The Nissan Leaf is a battery electric and is the first of its kind to be made by a big automaker.
While it is true that a majority of the electric power plants that produce the energy to run these cars use fossil fuels, on the balance electric cars produce about half of the CO2 emissions of ordinary combustion engine cars. They are also coming down in cost and, once purchased, charging the average electric car at your home will add about $30 to your electric bill and save you about $97 on fuel when driven 12,000 miles annually. So while they may not be the idle solution, electric cars have come a long way and new innovations and improvements are making them more and more attractive to consumers and the environment.
Power plants supply massive amounts of energy to consumers in the form of electricity. Electricity is used to power our homes, businesses, and sometimes our cars. This electricity is distributed to us by a system called the electrical grid.
Many researchers claim that our grid system is outdated and inefficient. In fact, our current electrical grid system has its origins in the 1960’s and has even been called a “third-world grid.” Today, our grid can be called “centralized” where there are large power plants that generate and sell electricity to places far away from them. This electricity must be pushed along long lines to reach potential customers. The farther electricity is sent, the more energy is lost, making this system inefficient.
Long power lines are also vulnerable to natural conditions like extreme weather. Take a look at the devastation to the power grid that Hurricane Sandy caused this past year. The storm’s high winds and water damaged lines along the East Coast that were carrying power to people far beyond the storms reach. Due to the current structure of the grid, many people did not get hit with wind or rain but still experienced Sandy’s destruction with massive blackouts. Since electricity is such an important part of our daily lives, not having power for extended periods of time can be damaging to our health and economy.
Many people believe that to have a smarter grid, the U.S. must move towards decentralization of the utilities. One method of accomplishing this is through “synchronization.” Instead of one large power plant supplying electricity both locally and over distances, synchronization model calls for many small power plants strategically spread out supplying energy all over. The small power plants will work together and simultaneously, similar to how synapses work in a human brain. This could potentially reduce the number of black outs because power would be distributed evenly. If one line is down the electricity would still be able to flow to its destination through other sources.
(image from SciTechDaily @ http://scitechdaily.com/synchronization-in-a-decentralized-power-grid/)
Since multiple, strategically placed power plants would put less strain on the grid, renewable sources of energy become more feasible. Since the output of renewable sources is typically much less than a large, fossil burning or nuclear plant, the small integrated plants could easily be renewable sources. Also, with an integrated system, residential solar panels would have more impact. Imagine thousands of photovoltaic panels across the roofs of houses in your neighborhood. During high electrical use periods, like mid say summer, electricity would be constant and widespread.
This country might not be ready for the decentralized, synchronized grid method just yet. Many problems must be addressed before implementing such a project. For example, In order to accommodate a decentralized system, the current infrastructure must be updated by replacing failing and obsolete power lines. The biggest questions are: who would be tasked with doing this? And how will the costs be distributed?
 Said by Bill Richardson, President Clinton’s Energy Secretary. Available at http://www.resilience.org/stories/2008-05-07/u-s-electric-grid-will-it-be-our-undoing