Power System Deregulation And Smd - Status And Future Projections

Over the past several years, the pace of electrical utility generation system deregulation in the United States has slowed considerably. In 2002, the Federal Energy Regulatory Commission (FERC) initiated the implementation of a standard market design (SMD) governing the wholesale electrical power industry. Both of these changes to the electrical power industry are important to industrial and commercial consumers. This paper provides an update of the status of both of these developments. The paper also addresses the framework of SMD and what it means to power system consumers. FERC developed SMD to modify the electrical power transmission system as follows:Establish a single open access transmission tariff that applies to all transmission customers - wholesale, bundled retail and unbundled retail.Encourage that the transmission system be operated by independent entities.Adopt location marginal pricing (LMP) structure to provide incentive to ease congestion.Facilitate real-time and day-ahead markets.The paper reviews these changes together with other changes being implemented by FERC via SMD.