What's Happening in Energy highlights the most interesting findings from public utility commission filings.
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What's Happening in Energy — Jan 9
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Picking up from the last WHiE, in a recent Virginia data center load technical conference transcript explored whether data center flexibility is misaligned with AI inference load (versus training load). During the first panel, Amazon Web Services (AWS) cautioned that the distinction between inference and training is not as straightforward as it may seem (pp. 28–31):
…from our standpoint, when we are deploying these data centers from here forward, folks will talk about… an AI data center or machine learning or an inferencing or a training. From the AWS perspective, these aren't mutually exclusive. Right? We could host… the various services within a single facility… So… mandatory flexibility or mandatory curtailment… makes it very challenging… because we're meeting customer demand and ensuring that they have access to their data when they so choose to.
Simple Thread echoed this point with a metaphor underscoring the difficulty of separating inference from training loads (pp. 76–78): “Our brains don't work that way. We don't train our brains and then use our brains. It's all happening at the same time… We don't know what these loads are going to look like… which means sharing data continuously.”
Dig into the full transcript below. Want a large language model (LLM) to summarize the transcript for you? Use this Halcyon query as a starting point to slice and dice the transcript as you see fit.
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In Nevada, the Commission adopted a new regulation requiring gas utilities to file resource plans every three years, along with accompanying demand-side management plans Originally, gas utilities were required to submit annual “informational reports” to the Commission. The requirements were revised by S.B. 281, passed during the 2023 Legislative Session, ultimately establishing the new three-year planning cycle. Read through the strikethroughs and the changes included as Attachment 1 in the Commission’s final order linked below.
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And speaking of gas, in Colorado, a non-unanimous, partial joint stipulation on Public Service Co’s (PSCo) gas infrastructure plan was filed by Rewiring America, Denver, Sierra Club, and others. The filing urges limits on gas System Safety & Integrity (SS&I) spending, calls for evaluation of non-replacement alternatives, and other recommendations.
Amid numerous filing revisions from parties, the Utility Consumer Advocate argued that as gas customers decline, PSCo should abandon uneconomic pipelines to rein in rising SS&I capital and O&M costs. The advocate compared continued investment in such assets to maintaining a branch for a single remaining “leaf” (figure 1), recommending that any abandonment paired with equivalent replacement.
PSCo also requested a certificate of public convenience and necessity (CPCN) for the Speer Canal project. Try this Halcyon query to learn more about Speer Canal and recommendations from the joint stipulation.
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In South Carolina, the Office of Regulatory Staff (ORS) filed a petition for rehearing and/or reconsideration of Duke Energy Progress’s (DEP) application seeking approval of its demand-side management and energy efficiency Rider 17. Curious why ORS sought rehearing – and how Duke responded, and ORS replied in turn?
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In California, a corrected California Energy Commission staff presentation updates the state’s 2025 energy demand forecasts using revised inputs (demographics, economic growth, and rates and lower self‑generation assumptions). The update also incorporates data center demand and other known‑load additions, raising the high‑case baseline (notably adding ~33 TWh by 2045). Interestingly, the revised forecasts assume lower near-term (2024-2028) economic growth and a downturn in electricity consumption from the cannabis industry.
By contrast, perhaps less surprisingly, data center load is higher than in 2024 forecast–particularly load with an Agreement secured in PG&E.
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In Texas, briefs closed in a year and a half case stemming from a resident of a tiny-home community for the chronically homeless, alleging that the nonprofit Mobile Loaves and Fishes (MLF) overcharged her for electricity. According to MLF, no “meaningful evidence” supports these accusations:
The Commission agreed, further affirming MLF’s argument that it had, in fact, undercharged the resident: “...it has been demonstrated exhaustively in the pleadings and the evidentiary record that Complainant has failed to provide any probative evidence that shows, by a preponderance of the evidence, that MLF has in any way overcharged Complainant for electric service. In fact, the evidentiary record actually shows the opposite. There is ample evidence that shows Complainant benefitted from a calculation error by MLF and was undercharged for her electric service for over three years.”
Check out the briefs from each perspective below.
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At the FERC, Trailblazer Pipeline Company filed an updated tariff for its interstate pipeline. Expert testimony recommended Return on Equity (ROE) of 14.10%, derived using a two-step method that established a baseline ROE of 12.98%, with additional basis points added to reflect Trailblazer’s risk relative to the proxy group of DT Midstream, Enbridge, Energy Transfer, Williams, and Kinder Morgan.
"...Trailblazer faces overall risks (which are beyond the control of its management) that are, on balance, greater than the median risks represented in the Trailblazer Proxy Group. Trailblazer faces several unique risks, including: not being directly connected to natural gas supply, having over 67% of its firm capacity scheduled to expire within the next two years, direct competition with other interstate pipelines, operational risks related to being primarily dependent on the REX Lease, as well as heightened financial risks due to its small size. Trailblazer is clearly a much smaller entity than each of the five members of the Trailblazer Proxy Group, which must be considered when analyzing and comparing Trailblazer’s overall risks to the proxy group entities. As discussed previously, investment risk increases as company size diminishes, all else remaining constant."
More details on the two-step valuation method used to calculate the ROE and the justification for increasing the baseline return.
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In the District of Columbia, Atrium Economics submitted Phase 1 of its audit of Pepco’s management processes. While the audit found no imprudence or violations, it made several recommendations. One (OR-4-4) flagged issues with Pepco’s reporting of budgeted versus actual project costs. Atrium observed that the misalignment in Pepco’s 2023 and 2024 budgeted vs. actual capital expenditures is difficult to analyze because the ITN numbers used to identify projects combine both “parent” and “sub-part” projects. Reporting these figures on an annual basis, Atrium argues, does not accurately reflect the project performance over the multi-year period, which is more relevant for the multi-year rate plan.
See the discrepancies in the budgeted vs. actual capital expenditures in 2023 and 2024 below.
Pepco also provided a table breaking down the cost impacts and lead time delays of major project deviation drivers. Transformer disruptions can increase costs by as much as 140% and extend delivery timelines from 7.5 months to as long as 4 years!
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In ISO-NE, the system operator filed a proposal with FERC to replace the Forward Capacity Market with a Prompt Capacity Market. Under the proposal, the new capacity market would run annually and clear just one month before delivery, rather than three years ahead. ISO-NE says this shift would reduce “phantom entry”—payments to resources years before they are available—and improve risk management amid growing electrification, data centers, and load growth.
The planned Capacity Market reforms, referred to generally as the Capacity Auction Reforms (“CAR”), comprise three major changes to the region’s Capacity Market.…the proposed prompt capacity market that will allow the capacity auction to utilize more up-to-date, and thus more accurate information regarding available supply and demand for the delivery period...the potential for load growth in the next decade highlights the importance of a market design in which the auction clears based on the most up-to-date information on forecasted demand and available supply to meet that demand.
ISO-NE has asked FERC to approve the proposed reforms by March 31, 2026. If approved, additional changes would follow ahead of the first auction in May 2028 for the June 2028–May 2029 delivery period.
The table below summarizes the estimated costs for each resiliency measure in the SRP.