Grid Reliability Through Clean Energy

103 Pages Posted: 9 Aug 2021 Last revised: 3 Jun 2022

See all articles by Alexandra B. Klass

Alexandra B. Klass

University of Michigan Law School

Joshua Macey

University of Chicago Law School

Shelley Welton

University of South Carolina School of Law

Hannah Jacobs Wiseman

Penn State Law – University Park

Date Written: August 5, 2021

Abstract

In the wake of recent high-profile power failures, policymakers and politicians have asserted that there is an inherent tension between the aims of clean energy and grid reliability. But continuing to rely on fossil fuels to avoid system outages will only exacerbate reliability challenges by contributing to increasingly extreme climate-related weather events. These extremes will disrupt the power supply, with impacts rippling far beyond the electricity sector.

This Article shows that much of the perceived tension between clean energy and reliability is a failure of law and governance resulting from the United States’ siloed approach to regulating the electric grid. Energy regulation is, we argue, siloed across three dimensions: (1) across substantive responsibilities (clean energy versus reliability); (2) across jurisdictions (federal, regional, state, and sometimes local); and (3) across a public–private continuum of actors. This segmentation renders the full convergence of clean-energy and reliability goals extremely difficult. Reliability-focused organizations operating within their silos routinely counteract climate policies when making decisions about how to keep the lights on. Similarly, legal silos often cause states and regional organizations to neglect valuable opportunities for collaboration. Despite the challenges posed by this disaggregated system, conceptualizing the sphere of energy reliability as siloed across these dimensions unlocks new possibilities for reform.

We do not propose upending energy law silos or making energy institutions wholly public. Rather, we argue for calibrated reforms to U.S. energy law and governance that shift authority within and among the silos to integrate the twin aims of reliability and low-carbon energy. Across the key policy areas of electricity markets, transmission planning and siting, reliability regulation, and regional grid governance, we assess changes that would integrate climate and reliability imperatives; balance state, regional, and federal jurisdiction; and reconcile public and private values. We believe this approach to energy law reform offers a holistic and realistic formula for a cleaner, more reliable grid.

Keywords: electric grid, grid reliability, regional transmission organizations, independent system operators, federal power act, transmission siting, Federal Energy Regulatory Commission, North American Electric Reliability Corporation, climate change, extreme weather, Winter Storm Uri, transmission planning

JEL Classification: Q4, Q42, Q35, Q43, Q48, K23, K32, Q54

Suggested Citation

Klass, Alexandra B. and Macey, Joshua and Welton, Shelley and Wiseman, Hannah Jacobs, Grid Reliability Through Clean Energy (August 5, 2021). 74 Stan. L. Rev. 969 (2022), Penn State Law Research Paper No. 21- 2021, University of Chicago Coase-Sandor Institute for Law & Economics Research Paper No. 935, Available at SSRN: https://ssrn.com/abstract=3900194 or http://dx.doi.org/10.2139/ssrn.3900194

Alexandra B. Klass (Contact Author)

University of Michigan Law School ( email )

625 South State Street
Ann Arbor, MI 48109-1215
United States

Joshua Macey

University of Chicago Law School ( email )

1111 E 60th St
Chicago, IL 60637
United States

Shelley Welton

University of South Carolina School of Law ( email )

701 Main Street
Columbia, SC 29208
United States

Hannah Jacobs Wiseman

Penn State Law – University Park ( email )

Lewis Katz Building
University Park, PA 16802
United States

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