How PA’s Competitive Electricity Market Supports Green Energy
It’s time to recognize the large strides Pennsylvania’s electricity market is making in producing power that is not only cheaper, but cleaner.
Markets allow more flexibility to respond to consumer demands, such as investing in clean energy technologies. One example is the wind energy options unveiled by Allegheny Power. Customers of Westmoreland County can purchase wind energy for an additional 2.5 cents a KWH.
Another indicator of the market’s ability to spur green innovations is found in a recent survey of New Englanders. The survey concluded residents are more open to electricity markets because markets utilize conservations methods.
Conservation methods include demand-side response mechanisms, such as, real-time pricing and time-of-use rates. Using these technologies, customers know when electricity is more expensive and conserve accordingly. Many believe conserving power is the best way to decrease costs.
PJM manages the electricity market in much of the mid-Atlantic and has continually sought to increase energy conservation. PJM holds occasional auctions to add more capacity to the electric grid as demand increases. The most recent auction resulted in more wind, solar, and demand response capacity. This means fewer megawatts will need to be generated from non-renewable sources.
The natural gas boom in Pennsylvania will magnify the ability of the electricity market to conserve power. Natural gas plants can quickly respond to the grids changing demand for electricity. In fact, many intermittent energy sources, like wind, look to natural gas plants to produce power when the wind stops blowing.
Natural gas also has many environmental benefits. It releases half as much carbon dioxide and less than a third as much nitrogen oxides as coal. Currently, Pennsylvania produces over half of its electricity from coal.
The bottom line is competitive electricity markets are much more effective at integrating green power options as they become cost-effective. In contrast, governments resort to mandating the use of expensive technologies, which inevitably raises everyone’s electricity bill. These green businesses start out with government handouts and develop political alliances. In turn, these alliances ensure subsidies keep coming despite the efficiency or dependability of the electricity generated.
For example, proposed increases to Pennsylvania’s Alternative Energy Portfolio Standards would boost the amount of expensive green energy produced and raise electricity prices for every Pennsylvanian by $8 billion-$9 billion, or approximately $1,600-$1,800 per household. When governments try to overshadow markets with mandates everyone loses.
Thanks to electricity markets, consumers can now choose to pay more for green technologies or stick with traditional power, and put the pressure on green companies to develop a clean energy source that is comparable in price. With the continued development of the electricity market, Pennsylvania is well on its way to future that is both green and economically stable.
Tags: Add new tag, Allegheny Power, Green Energ yPennsylvania, PA Electricity
