New Study Shows Competitive Wholesale Electricity Markets Would Benefit NC Employers & Residents
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This whitepaper presents the results of a high-level analysis of benefits that could potentially be realized by Duke’s North Carolina customers if Duke joined an organized regional wholesale power market. Due to the significant benefits that have been experienced from these markets in other regions of the country, several Southeastern U.S. industry and consumer groups commissioned this analysis to inform policy markers and motivate a more comprehensive study of the customer benefits that organized wholesale power markets could provide to North Carolina. Our preliminary analysis shows that Duke’s participation in a Regional Transmission Organization (RTO)- operated regional market could provide benefits to customers in North Carolina up to almost $600 million a year. Because wholesale market benefits are region-specific, we recommend that a more comprehensive study be conducted to fully evaluate participation in a regional wholesale power market and the benefits that doing so would likely provide for North Carolina customers.
Wholesale power markets administered by RTOs and Independent System Operators (ISOs) cover more than 30 U.S. states, serving over two-thirds of electricity consumers in the U.S. Numerous studies, focusing on different regions of the country, have shown that these regional markets provide significant benefits to electricity customers by reducing the cost of power, increasing reliability, reducing the need for new generation and transmission facilities, aiding the integration of renewable energy resources, and improving system balancing and operations.
For example, PJM (the market operator that borders North Carolina) recently estimated that its market resulted in benefits of $2.8 billion to $3.1 billion per year for customers in its region. Due to these benefits, both investorowned utilities and public power companies continue to join and expand these organized regional power markets with the support of state regulators and policy makers.