Branko Terzic

  • Puerto Rico Chooses Concession: Two Strikes to Date

    This piece is the second by the author on Puerto Rico’s electricity system. You can read the first piecehere.

    The government of Puerto Rico has selected “concession” as the method of privatizing the transmission and distribution assets of the commonwealth’s electric system, Puerto Rico Electric Power Authority (PREPA). This privatization through “concession” of transmission and distribution functions will accompany the parallel sale of PREPA’s electric generation assets and the introduction of a new regulatory administration that the Public Service Regulatory Board established in August. However, the direct regulation of electricity is assigned to a new subsidiary Energy Bureau, with five new commissioners.

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  • Puerto Rico’s Electric Industry Transformation

    Following the tragic weather events of 2017, the state of Puerto Rico’s infrastructure, particularly energy infrastructure, has been a contentious issue. In fact, even before Hurricane Maria, Puerto Rico’s electric service provider, Puerto Rico Electric Power Authority (PREPA), had been struggling with mismanagement and teetered on the brink of financial collapse for years. The damage caused to the electric system by Hurricane Maria reflected years of deferred maintenance and the slow recovery exposed the deficiencies of management.

    This combination of storm damage and a long history of mismanagement led to bankruptcy, forcing drastic action. While there are key challenges ahead, the government has taken a crucial...

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  • Is Power Ever Too Cheap to Meter?

    Despite decades of safe operation at over 100 power stations generating carbon free electricity, nuclear power remains a controversial topic in the United States. Nuclear opponents often remind the public that proponents once promised that electricity from nuclear power would be “too cheap to meter,” a promise that has so far gone unfulfilled. However, a closer look at this claim and ultimate reality is warranted.

    The phrase “too cheap to meter” was used in a 1954 speech by the then-Chairman of the Atomic Energy Commission, Lewis L. Strauss. The occasion for the speech was the 20th anniversary of the National Association of Science Writers, held in New York City on September 16, 1954. When Strauss spoke, no commercial nuclear power plant was in service.

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  • Prospects for a “Henry Hub” in the European Union

    The Henry Hub in North America is the most successful natural gas market in the world. Its success has stimulated discussions in other natural gas markets about the creation of new natural gas hubs to emulate Henry Hub’s operations. The question is: how can countries who want to create a hub in theory actually establish one in practice?

    Creation of a natural gas hub is perceived in international quarters as a way of meeting national goals for competitive natural gas supply and delivery, providing market prices adequate to inform producers and consumers, and creating a security of supply based on diversification of sources.

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  • Is it Time for a Central Energy Regulator in the European Union?

    The European Union (EU)’s energy sector has undergone many changes in the march to create a liberalized European energy market. However, while the EU has outlined common rules and implemented shared standards, the bloc still lacks a central energy regulator akin to the United States Federal Energy Regulatory Committee (FERC).

    The European Union has been integrating its national markets into one single market since the 1987 Single European Act, the first major revision to the 1957 Treaty of Rome, which established the European Economic Community and later the European Commission. Slowly but surely, the European Union also undertook liberalization of various sectors, introducing competition where there was a monopoly, starting with steel and coal.

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  • The Grid’s Ability to Meet Electric Vehicle Demand

    When it comes to electric vehicles, while there is no question sales will continue to rise, there are real questions about whether the electric power industry can keep up with new demand. However, past experience suggests it is a question that can be answered with a resounding yes for two reasons. First, the timing of the increase will allow the electric power industry to make the necessary capital investment. Second, the industry has experienced great growth in electric demand from new technologies in the past, and succeeded in meeting those challenges.

    Timing of New Electric Investment

    Some estimates suggest the number of electric vehicles on the road, currently around one million globally, could approach 24.4 million by 2030. To produce the high volume of electric vehicles that is projected, existing automobile manufacturing plants will have to be converted to...

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  • Three Issues the Energy Department’s Grid Study Must Address

    On July 14, an unofficial draft of the much-anticipated US Department of Energy (DOE) grid study, formally referred to as the Study Examining Electricity Markets and Reliability, was leaked, notably absent any recommendations.

    The report was requested in an April 14 memo by US Energy Secretary Rick Perry. A number of senators and representatives, based upon the language of Perry’s memo, publicly denounced Perry’s request for a report, putting him on notice that the final document will be scrutinized carefully. Other groups, mostly renewable energy supports, protested the request for the report as well....

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