The US electric sector is surprisingly easy to understand. It’s big, capital-intensive, complicated and integral to our standard of living – which gives it a massive bias in favor of the status quo. Neither its owners nor its regulators have any incentive to risk their money or their careers with sudden change. This makes it fairly predictable: take what’s happening today, and assume that will continue indefinitely forward until such time as (a) we overshoot some fundamental technical constraint and/or (b) some regulatory action upends the balance of power in the industry.
There have been several, noteworthy instances where regulatory reform led to rapid change: in particular, comprehensive energy bills passed in 1935 (PUHCA), 1978 (PURPA) and 1992 (EPACT). But comprehensive, ambitious legislation isn’t the current Congressional toolbox. So status quo is a safe bet.
However, that doesn’t infer stability of anything other than the trend line. John Allen Paulos made a (painfully) amusing observation in his book Innumeracy that based on current trends, there would soon be a one year waiting list for abortions. Thus do stable, linear sequences head inexor... Read more
