NATIONAL CENTER FOR POLICY ANALYSIS Turning on the Lights 2011: The Consumer Benefits of Electric Power Competition by Carl Johnston and Lynne Kiesling.

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NATIONAL CENTER FOR POLICY ANALYSIS Turning on the Lights 2011: The Consumer Benefits of Electric Power Competition by Carl Johnston and Lynne Kiesling April 2011

Cal-ISO ERCOT NE ISO PJM MISO Alabama Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming United States Km 100 Miles Hawaii 500 Miles 0500 KM 0 Alaska 0500 Miles Km NY ISO U.S. Independent System Operators (ISOs)/RTOs SPP

Restructuring States Pre-California Crisis Alabama Arizona Arkansas California Colorado Connecticut Delaware Florida Georgia Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana Nebraska Nevada New Hampshire New Jersey New Mexico New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virginia Washington West Virginia Wisconsin Wyoming United States Km 100 Miles Hawaii 500 Miles 0500 KM 0 Alaska 0500 Miles Km Restructuring States Post-California Crisis

Texas Fast Facts Competitive Sourcing: 43% of Residential >70% of Industrial In Houston, choice between 255 plans a five-fold increase from a year ago.

_content/_compare/showoffers.aspx 255 Offers Zero to 13.7c KWh Promotions Month-to-Month No Credit Req’d Daily Variable Rate GoGreen! Month Fixed

Prices In (Non) Congested States

Revolution in Generation Nukes in restructured states are 40% more efficient Renewable power output growing 20 times faster in restructured states (fair access to grid; wholesale response to intermittent output)

Revolution in Distribution Smart Meters: 28 million households with smart meters permitting two-way communication Digitization of the Grid paves the way to connections to the Internet

Revolution in Consumption Buyer or seller of production Optimization of electricity use throughout the day using “operating system” for your home. Self sufficient micro nets and community networks

Revolution in New Businesses Demand Response Aggregators Networked Appliances PHEVs New Software and Device Development Opportunities (Applications running on home operating systems)

Policy Recommendations Split vertically integrated utilities into service companies and power generators, allow free pricing nationwide Deregulate the utility market to provide choices for length of contract, fuel options, reliability—let consumers lead the market Give FERC Authority to Site Long-Distance Transmission Lines (or something similar) Divest Federal Power Generation and Transmission Assets Build Smart Grid Junk Preferences for Generation Technologies