March 27, 2014 – Richard Miller ’87 of ConEd Examines Path to More Competitive and Green Electric System

How do we move toward a greener electric system while encouraging competitive markets and reliable utility access? Richard Miller ’87, director of the Energy Markets Policy Group for Con Edison (ConEd) addressed this issue as the third speaker in the Energy Policy Discussion series hosted by the Frank J. Guarini Center on Environmental and Land Use Law.

Before entering into a complex discussion of the electric system’s future, Miller provided a layman’s overview of how electricity moves from generation plants to customers.

When it comes to electricity, he emphasized, a balance needs to be maintained between supply and demand. That is, when customers’ demand rises, generation—the supply—needs to be increased to meet it. But there is another option: customers can decrease their demand to meet the supply. This alternative, in which the customer reduces its demand, is called “demand response.”

“One of the goals of managing that electric system to generally try to make it cleaner and greener,” Miller said, “is to figure out ways that we can use that demand response more.”

From 1998 to 2003, Miller was senior vice president for energy at the New York City Economic Development Corporation. In 2003, he moved to ConEd, where he served as assistant general counsel, stepping into his current role in 2008.

He discussed the restructuring that took place in the 1990s, after which ConEd—which had been fully vertically integrated—would no longer control the electricity from the plants to the power lines to the customer. The federal government had the power plants sold off, turning them into a separate industry; hand-in-hand with this, power generators were given open-access to the transmission system which in turn came to be overseen by new agencies like the New York Independent Systems Operator (NYISO). The goal: increased competition.

Legally, this also meant a major jurisdictional change: this market, which once fell under state jurisdiction, was suddenly subject to federal jurisdiction. The NYISO, for example, answers to the Federal Energy Regulatory Commission (FERC).

This change has raised a key question: How can states promote renewable power despite this jurisdictional change? Miller highlighted Maryland’s beleaguered attempt to accomplish this goal. He also discussed plans to build more transmission for public policy reasons, and the benefits and disadvantages of relying on “demand response” to decrease customer demand.

In his closing, he referred the address given by Audrey Zibelman, chair of the New York State Public Service Commission, during the “Utility Industry of the Future” symposium at NYU Law. She stated that the most cost-effective way to get to a better system is to use competitive markets.

“We all want a greener and cleaner system,” Miller concluded, “but we all want to do it in the least expensive way possible.”

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