“A properly functioning market … simply needs clear price signals, enforceable property rights, and the freedom for buyers and sellers to contract with one another…. The Public Utility Commission of Texas effectively imposed a $26.3 billion monopoly tax on Texans by overriding the market signals the Legislature had said should govern the system.”
Recent reports on the collapse of Fermi’s stock price should get the attention of anyone watching Texas’ rapidly growing demand for electricity. Here was a company promising massive new generation—tied to the surge in AI and data centers—only to see its stock price collapse. While Fermi may still succeed, there is a broader lesson for the Texas electric grid.
Texas needs more power. Projects like Fermi show the private sector is trying to respond. But too often, these efforts look like they are being forced to work around the grid rather than through it.…
“If Illinois wants an affordable and reliable grid, the answer is to end subsidies and mandates for all forms of generation. And to eliminate regulations that are taking the most affordable and reliable fuels out of the generation mix. Nothing else will work.”
Electricity prices are climbing in Illinois. As is the public’s concern about them. To address this, Governor JB Pritzker and governors from four other states recently asked the PJM Interconnection to do something about the escalating rates.
While the concern is widespread, there is little consensus over the cause of the higher prices. Some blame fossil fuels. Others the PJM capacity market. And others a lack of investment in battery storage. Most agree, though, that government intervention is needed to fix the problem.
However, a closer look shows that government intervention is the source of the problem.…
“Whether it is the unprecedented subsidies for renewable energy or the unprecedented war on American energy, the Biden administration’s policies are behind the increase in America’s electricity prices.”
During the first three years under Biden vs. last three under Trump, average wholesale electric prices in the seven U.S. independent or regional service areas have increased by 72%. Retail prices are also higher. The average 2024 U.S. residential rate to date is 24% higher than in 2020. For all end users—residential, commercial, industrial, and transportation sectors—prices are up 23%.
This rate surge reflects the massive renewable energy subsidies authorized in the Inflation Reduction Act of 2022, signed by President Biden, that tripled the outlay of such federal largesse. Another factor is the administration’s natural gas policies, which banned imports of Russian oil, liquefied natural gas, and coal; joined with the European Commission to reduce Europe’s dependance on Russian oil; and put a pause on LNG permits.…