H.R.604 - Responsive Energy Demand Unlocks Clean Energy Act; REDUCE Act (119th Congress)
Summary
H.R. 604, the REDUCE Act, aims to promote demand flexibility in organized wholesale electric markets. It requires Transmission Organizations to allow aggregators of retail customers to submit bids, even if state laws prohibit it. This applies to utilities distributing over 4 million megawatt-hours annually.
Expected Effects
The bill seeks to increase competition in energy markets by enabling aggregators to participate. The Federal Energy Regulatory Commission (FERC) is mandated to create rules for this within 12 months of enactment. This could lead to more efficient energy use and potentially lower costs for consumers.
Potential Benefits
- Increased competition in wholesale electricity markets.
- Potential for lower energy costs for consumers through demand response.
- Encourages innovation in energy aggregation and demand flexibility.
- Could lead to a more resilient and efficient energy grid.
- Promotes the integration of renewable energy sources.
Potential Disadvantages
- Potential conflicts with existing state laws and regulations.
- Possible challenges in implementing and enforcing the new rules.
- Risk of market manipulation by aggregators.
- Increased complexity in grid management.
- Uncertainty regarding the actual cost savings for consumers.
Constitutional Alignment
The bill's mandate to FERC to create rules impacting state regulations raises questions under the Tenth Amendment, which reserves powers not delegated to the federal government to the states. However, Congress has the power to regulate interstate commerce under Article I, Section 8, Clause 3 (the Commerce Clause), and electricity markets often cross state lines, potentially justifying federal intervention. The bill does not appear to infringe on any individual rights or liberties protected by the Bill of Rights.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).