Fifth Anniversary Capital Campaign

CAEM is celebrating the fifth anniversary of its founding in 1999, still the only think tank exclusively committed to competitive energy markets.

This anniversary represents an opportunity to recommit ourselves to ensuring an effective transition from the monopoly model of utility regulation to the competitive model. We can only accomplish this with support from individuals and companies committed to CAEM’s mission and vision.

The Past Is Prologue

Our mission and vision for the future are planted firmly on the foundation of our first five years. We refer you to three sources that lay out where we have been:

Branko Terzic, former FERC and Wisconsin Commissioner, former CEO to a utility, and currently a Director at Deloitte & Touche and member of the CAEM Board of Directors, gave a testimonial at our Fifth Anniversary Gala.
CAEM commissioned a history for our anniversary. The result was The CAEM Story: Opening Minds to Changing Energy Markets.
Of course, our website contains even more extensive information about CAEM’s accomplishments.

Forgive us if we brag a bit. As Branko Terzic put it:

"A lot of people wondered in 1999 whether we needed a think tank devoted exclusively to energy competition issues. I thought so then and I think so now. Events of the last five years have certainly vindicated the original vision we had for CAEM. I am proud to have been part of the group that had the boldness to have ignored conventional wisdom and taken the road less traveled."

Corporate support to CAEM resulted in the following education and outreach accomplishments:

The RED Index, four annual report cards measuring progress on retail electric policy in 67 jurisdictions.
Reports and Studies, such as our rebuttal of a Cato Institute report; our support NARUC on uniform business practices; our DISCO of the Future Forum, Distributed Energy Task Force, Default Policy Forum, Customer Care Consortium, and Grid Enhancement Forum; our reports on the impact of potential price caps in Georgia and Ontario and the benefits of deregulation of natural gas and competition in PJM; our extensive comments to the FTC on their study of electric power regulatory reform; and others. You'll find links to them all on our home page.
Speeches, Meetings, and Conferences, such as organizing the North American Summit on Energy Restructuring for DOE and NARUC; the development of the Competitive Energy Network; presentations and testimony to the New York, Pennsylvania, California, Alabama, and Delaware Commissions; and keynote addresses at numerous industry meetings.
The IDEAS Foundation (Integrated Development of Energy Assets and Services), the public/private advisors that help prioritize our research and analysis agenda.

The concept of a think tank supporting competitive energy markets proved so compelling that Public Utilities Fortnightly named CAEM an “energy innovator ringing in an age of enlightenment” and we opened a Canadian affiliate in Toronto in 2001.

CAEM's expertise has been cited in more than 300 articles in publications ranging from national daily newspapers to industry journals. We compiled these articles as CAEM in the Press: 1999 to 2004 and it is an impressive 800 pages long. It includes CAEM’s contributions to CNN, Business Week, TIME, US News and World Report, MSNBC, the Nightly Business Report, the Chicago Tribune, Reuters, Salon.com, the Christian Science Monitor, and a full page spread in USA Today featuring the RED Index.

One measure of CAEM’s effectiveness is what public officials say about us. Below are some highlights:

FERC Chairman Pat Wood stated “As we worked to set up Texas’s wholesale and retail power markets while I was chairman of the Public Utility Commission of Texas, the RED Index was our objective benchmark for measuring success. Although our focus at FERC is on wholesale markets, I still look at CAEM’s fine work on the RED Index as an excellent barometer for the state of global power markets today.”
Thirty-two Congressmen signed a letter to FERC urging action on PJM, using CAEM’s PJM study to support their position.
Bill Flynn, former President of NYSERDA and currently Chairman of the NYPSC, has stated the RED Index has become “an essential tool for understanding the rapid changes taking place with policies on retail electricity competition.”
Michigan then-Chair Laura Chapelle used Michigan’s ranking in the RED Index to rebut a critique of Michigan’s retail choice program.
DC then-Chairman Angel Cartagena stated, “The Final Report of the DISCO of the Future Forum needs to be under every regulator’s Christmas tree this year.”
Pennsylvania, New York, Texas, and Maryland have all issued press releases touting their ranking in the RED Index and then-Governor Tom Ridge mentioned in his final State of the State address Pennsylvania’s ranking in the RED Index as indicating his success in leading electric restructuring in Pennsylvania.
FERC’s SMD white paper mentions CAEM’s study estimating benefits resulting from natural gas restructuring and the FTC report to Chairman Tauzin prominently mentions the RED Index and CAEM’s comments.
FERC Chair Pat Wood and PJM CEO Phil Harris have publicly discussed CAEM’s study of the Benefits of Competition in PJM.

The Next Five Years

Where are we going in the future? (Or, what will we do with the money you give us?)

CAEM’s Capital Campaign will ensure that the movement towards competitive energy markets is a vision supported by a strong foundation of funding.

In our first five years, we focused on developing analytical products. In the next five years, there is no question that we will continue to provide the intellectual foundation justifying reliance on energy markets. Right now we have projects percolating on a fifth edition of the RED Index for electric, a RED Index for gas, alternative dispute resolution, default policy for mass market customers, a strategy for the future initiative, and a four-country study (U.S., Canada, Australia, and New Zealand).

In our first five years, we focused on education and outreach to key decision makers. As we have become better known, we find more doors open. No question we will continue to do this to a much greater extent in the next five years. Right now we are developing the Leading States Forum (a forum for state commission staff to exchange insight on how restructuring is working), a program of workshops to be delivered on-site at state commissions and legislatures, and Camp Competition (a training program for PUC staff to counter the traditionalist impulses of Camp NARUC).

But in the next five years we will also take on a new role: helping develop a stronger community supporting competitive electric markets. Competition policy suffered setbacks from the Four Horsemen of the Energy Apocalypse: California, the collapse of Enron and other energy companies, volatility and higher prices for natural gas, and the blackout. Less discussed but nonetheless part of this backdrop is the Death by a Thousand Duck Bites, a series of more minor but still significant setbacks to competition, such as Ontario price caps, the attacks on FERC’s SMD initiative, the Cato study, and at least a dozen other events we have chronicled.

Good ideas effectively articulated are merely seeds full of potential growth. The musculature of influence is the fertile soil that allows these seeds to bloom. We have taken steps in the last year to support the revitalization of the competitive energy movement. We have established the Energy Competition Leadership Awards presented at a star-studded banquet, held for the first time in July 2004. The response to these community enhancing initiatives was overwhelmingly positive and is now planned as an annual event. Our Board of Directors instructed us to develop the first annual Convention for Supporters of Energy Markets (to be held in June 2005). We have been asked to organize the Leadership Council for Electric Competition, a coalition of academics, present and former government officials, industry players, and consumers that promotes a public interest rationale to key decision makers that competitive electric markets are an essential requirement for the future of the United States and North America. Lastly, we must develop and nurture the leadership for this movement so critical to our increasingly digital future.

Can We Close the Deal?

Well, that’s it in a nutshell. In thinking about supporting CAEM’s future efforts, you have to answer two questions: