Monitor of several US central grid operators said that the US power generation sector is not overly dependent on natural gas
David Patton, president of Potomac Economics, told an Energy Bar Association meeting yesterday it was disturbing that US energy secretary Rick Perry's instructions to the Federal Energy Regulatory Commission (FERC) to make the grid more resilient focused on reliability and not cost.
Patton's firm is the independent market monitor of grids in New England, New York, Texas and the Midwest.
But other speakers on a panel with Patton experienced in electricity market design suggested that FERC's handling of the grid resiliency proposal can be balanced with clean energy goals of states, which use various forms of generation.
"The subsidies are on their way out because costs are coming down," said Peter Fuller, vice president for market and regulatory affairs at NRG Power Marketing. "At some point in the future, renewables and clean energy will be the predominant sources, with gas as a backstop product."
Fuller's recommendations for market design included scarcity pricing, carbon pricing and forward clean energy markets.
Patton said gas-fired combined cycle generation is still the cheapest option under a carbon price scenario, and that frequent policy changes will harm long-term investments.