The U.S. Department of Energy, the Federal Energy Regulatory Commission (FERC), and wholesale market administrators have begun examining the impact of “state policy decisions” on wholesale energy markets, particularly decisions to promote specific types of generation resources (e.g., zero emission resources). In fact, state policy discussions in recent years have acknowledged—at least tacitly—the pressure put on the traditional, capital-intensive distribution utility business model by discussing the potential for distribution utilities to serve as “platforms” for new services. As environmental and economic regulation for utilities appear headed on a collision course, what precisely is a “practice affecting wholesale rates” has the potential to become increasingly blurred.
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