MAY 2001

The growing public concern with the adequacy of electrical power that has become an essential element of the American economy and life-style requires bold and innovative action for the development of a comprehensive and realistic national electrical energy policy.

NEMA believes that such a policy must of necessity foster prudent use of existing energy capacity as well as promote investment in new power generation and delivery systems; each based upon existing and proven technology solutions.

NEMA believes that a comprehensive national electrical energy policy should be primarily market-driven, combined with an effective public policy, that is responsive to both consumer and industry needs. The cornerstone of that policy should address the important issues of energy sources and generation, transmission and distribution grid infrastructure and reliability, and energy efficiency and conservation.

NEMA believes that the fundamental premise of a comprehensive national electrical energy policy includes:

• Reliance on affordable, proven technology to address energy supply and demand efficiency;
• An understanding that energy efficiency and conservation doesn’t mean sacrifice and reduced access, but rather doing more with existing capacity by achieving reduction in energy usage through the use of more efficient products and systems; and
• The primary use of market-based incentives with the acknowledgement, on a case-by-case basis, of the value of other interventions such as targeted government research and development

NEMA believes the development of a national electrical energy policy, to meet current and future energy demands for reliable and efficient electrical systems and procedures, should be guided by the following considerations:

• Energy Efficiency. NEMA believes energy efficiency is a national concern that should be driven by market forces to achieve energy efficiency and conservation. The litmus for efficient products and control systems is technological feasibility, economic justification, energy savings and commercial availability. Further, NEMA acknowledges the key role the federal government should play in fostering public use of energy efficient products and systems including:
  • promoting user education on energy efficiency;
  • supporting energy efficient upgrades through programs such as the Federal Energy Management Program;
  • encouraging performance-based incentives in the private sector; and
  • use of economically sound energy efficient products and systems.

• Generation, Transmission and Distribution Infrastructure Regulation and Reliability. NEMA believes that maintaining adequate supplies of electrical power at the lowest possible cost, while ensuring reliability with enforceable standards, is crucial to an effective and successful national electrical energy policy. To that end, NEMA urges, among other things, that the national policy incorporate a regulatory structure that promotes:
  • Use of technology to enhance capacity and protect the integrity, as well as extend, the interstate transmission grid, distribution grid and its reliability;
  • Removal of impediments to obtaining permits that currently serve as a barrier to the siting and construction of new facilities and installation of new transmission lines;
  • Market-based incentives coupled with regulatory policies to allow the recovery of the cost of investing in new generation facilities and transmission and distribution infrastructure, and to ensure a competitive return for the investment; and
  • Allowing states to enter into regional compacts to address siting issues.

• Sources and Generation of Power. NEMA recognizes that all economically viable and socially acceptable sources for generation of power are key components of any comprehensive national electrical energy policy and, therefore, system reliability and power quality must be promoted. Furthermore, minimizing the barriers and obstacles to installing industrial co-generation and distributed generation facilities will enhance the power generation system capability to deliver reliable electrical energy. NEMA supports a national electrical energy policy that includes broad choices of economically and scientifically-sound technology for the generation and distribution of power in the United States.

Adopted by NEMA Board of Governors 05/16/01.