Durham Reporter

Duke University released a study that a larger Southeast power market would lead to lower prices and cleaner energy in North and South Carolina. 

The Nicholas Institute for Environmental Policy Solutions conducted the study, which said if a larger power market were to exist in the Carolinas, the monopoly of power sales, such as Duke Energy Corp. and The Southern Co., would be weakened. 

“From a preliminary evaluation, it appears that southeastern utilities joining a Regional Transmission Organization would likely produce the most benefits compared to other options, especially if it results in a large footprint with diverse resources and customer demand,” Jennifer Chen, senior counsel for federal energy policy at the Nicholas Institute wrote in "Evaluating Options for Enhancing Wholesale Competition and implication for the Southeastern United States," according to the Charlotte Business Journal.  

Joining into one market can lead to lower wholesale costs, provide non-incumbent generators and improve the system's flexibility and efficiency, according to the Charlotte Business Journal. 

And North Carolina and South Carolina both already have legislation for a similar idea underway. 

In South Carolina, the General Assembly has a legislative study commission, which will consider Regional Transmission Organizations (RTOs) that could possibly operate in multiple southeastern states. 

North Carolina Sens. Tom Davis and Wes Climer proposed a bill that authorizes studying other alternatives to the power market, according to the Charlotte Business Journal. Davis and Climer are looking at options that could include both North and South Carolina. 

Chen said RTO advantages grow in proportion with the market size, which allows plenty of opportunities to create a structured power market, according to the Charlotte Business Journal. 

“The Southeast has enjoyed low electricity rates, but its total energy bills are high compared to consumer income,” she wrote, according to the publication. “Competition between energy resources across larger regions has helped to ensure resource adequacy and reliability at lower wholesale energy costs, and more recently, has facilitated natural gas and renewables displacing more expensive coal.”

But state policies will delay market changes, Chen said. Not all beneficial changes to the power market will comply with the environmental and social policies states would like to use as regulation. 

Chen wrote, “While enhancing wholesale competition and regionalization are important in the long run for a more flexible and low-emissions grid, these changes alone cannot displace state policies designed to meet specific environmental targets, especially in the near term.”