Grid Reliability Through Clean Energy

71 Pages Posted: 9 Aug 2021 Last revised: 25 Nov 2021

See all articles by Alexandra B. Klass

Alexandra B. Klass

University of Minnesota 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

Energy policy is at a critical turning point. To counteract potentially catastrophic climate change, we must rapidly transition to clean energy. At the same time, we must ensure the reliability of an increasingly vulnerable electricity grid. In the wake of recent high-profile power failures, both 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. Reducing carbon emissions by transitioning to clean energy is the only way to maintain a reliable grid going forward.

This Article shows that much of the perceived tension between clean energy and reliability is a failure of law and governance that results from the United States’ siloed approach to regulating the electric grid. Energy regulation is, we argue, siloed in three directions—among substantive responsibilities (clean energy versus reliability); across jurisdictions (federal, regional, state, and sometimes local); and along a public-private continuum of actors. This segmentation renders the full convergence of clean energy and reliability goals nearly impossible: reliability-focused organizations operating within their silos routinely counteract climate policies—often inadvertently, but sometimes more deliberately—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 to upend energy law silos or make 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 low-carbon, reliable 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). Stanford Law Review, Forthcoming, 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 Minnesota Law School ( email )

229 19th Avenue South
Minneapolis, MN 55455
United States
612-625-0155 (Phone)

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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