US power struggle: How data centre demand is challenging the electricity market model

Without true markets for electricity, we have no idea whether things are fine or disaster is about to strike. WoodMac's great report highlights this problem, "...ERCOT is planning to build out the grid to accommodate more than 60% new demand growth (50 GW) by 2030, while the wires utilities are building out interconnections. Despite predictions by the North American Electricity Reliability Corporation (NERC) of elevated resource adequacy risk and the need for massive amounts of new generation to meet this growth, ERCOT forward prices remain below the level necessary to incentivise new entry." The grid planners and the reliability experts tell us we need new capacity while the administratively designed market tells us we don't. Which is right? No one knows but we do know that existing ratepayers who rely on the grid and who are on the hook to pay for the wires build out even if they're not needed. Is there a better way to deal with this complex economic problem?

"Consumer Regulated Electricity" or CRE is one policy tool that can help states with this problem. CRE would enable to the creation of new, independent, competitive, and large-scale utilities for the first time in a century. We need new ideas to solve this complex economic problem. Now.

To learn more about CRE send us a message here on LinkedIn, follow us, and check out our website Advocates4CRE.org.

https://www.woodmac.com/horizons/us-data-centre-power-demand-challenges-electricity-market-model/