Report
Energy deregulation and permitting of merchant power plants
01 Jan 2000
Abstract
The deregulation of the electric utility industry has opened up competition to offer products and services that, previously under regulation, were offered through a utility. Companies that compete effectively will have to operate with more flexibility in this market-driven environment. Historically, electric utilities were guaranteed rates of return on their investments in return for reliability of service and reasonable rates for customers. However, the new environment calls for delivery of power to the transmission grid on a day ahead or spot market basis. Compliance with environmental regulations and development of strategies for permitting are crucial in allowing for flexibility in operations. Our case study examines the acquisition of a power plant in the northeastern U.S. and outlines the environmental challenges in permitting the facility for air quality compliance in the deregulated environment. The importance of coordinating with state and Federal agencies, and the impact of new regulations on proposed operations, is discussed. The deregulated environment in the northeastern U.S. calls for new environmental regulations for controlling ozone emissions in the summer. This new regulation in place since May 1999, called the NOx Budget Rule, uses an allowance trading system that harnesses free market forces to reduce pollution. Each source is allocated ozone season allowances that may be bought, sold or banked. Compliance with this regulation, while maintaining competitive advantage, is addressed for the case studied.
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Details
- Title
- Energy deregulation and permitting of merchant power plants
- Creators
- Suresh ChandranJohn WeberWDavid Jenkins
- Resource Type
- Report
- Language
- English
- Academic Unit
- Management
- Identifiers
- 991021810268804721