Reprinted with permission from Wind Solar Alliance

Wind and solar energy are leading sources of new electricity generation, driven by increasing demand and rapidly declining costs. The shift in generation types will affect the whole electric industry — generation, system operations, transmission and distribution.

This report focuses on the wholesale power markets and system operations aspects of the electric industry, with particular focus on the Mid-Atlantic (“PJM”) and Midwest (“MISO”) regions. Two-thirds of the electricity in America passes through centralized wholesale electric markets, serving much of the nation’s economy and population. Those market rules and practices are developed by stakeholders in those markets, overseen by federal energy regulators and affected by state regulatory decisions. The market rules determine how the grid operates, which resources get financing and interconnection, what products are offered, what resources get paid, and more. Market rules can make or break the economics of an individual supply or demand resource, and the reliability and affordability of electricity.