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AMERICAN WIND ENERGY ASSOCIATION STATEMENT ON COMPETITIVE WHOLESALE ELECTRICITY MARKETS AND RENEWABLE ENERGY

Following a recent statement by the American Public Power Association questioning the role of competitive wholesale electricity markets in renewable energy development, and given the need for accurate information on this important issue, the American Wind Energy Association (AWEA) issued the following statement concerning the U.S. wind energy industry’s views on the role of such markets in promoting wind power development.

Broad wind industry support for competitive wholesale electricity markets:

AWEA’s Board of Directors approved on January 9 a resolution supporting the preservation and expansion of competitive regional wholesale electricity markets.

Why competitive wholesale markets promote wind power development:

In a February 26, 2007 letter to Federal Energy Regulatory Commission (FERC) Chairman Kelliher, AWEA and a number of organizations stated: “Independently run regional grid operations can foster renewable energy and demand response development by:

• Eliminating “pancaked” transmission rates that are assessed across every utility area;
• Providing energy markets where variable or intermittent resources can sell excess energy or purchase shortages at a transparent and fair price;
• Minimizing operational impacts of variable resources by netting out aggregate load and generation over a wide region;
• Facilitating regional transmission planning to access generating resources as well as address reliability, congestion, and load growth in the most efficient overall manner;
• Providing a mechanism to pursue regional cost allocation policies; and
• Providing for flexible transmission tariffs that allow rates to be paid on an as-used basis as opposed to a capacity reservation basis."

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