The REDUCE Act requires transmission organizations that operate wholesale electricity markets to allow aggregators to bid on behalf of groups of retail electricity customers. Specifically, aggregators can submit bids representing the flexible energy demand of customers served by larger utilities that distributed over 4 million megawatt-hours in the previous year. This change aims to let residential and commercial customers participate more directly in wholesale power markets through aggregators, potentially unlocking demand-side resources that can help integrate clean energy. The Federal Energy Regulatory Commission must establish final rules within 12 months of the law's enactment to implement these requirements, overriding any state prohibitions that currently prevent such bidding arrangements. The bill essentially removes barriers that have prevented customer demand flexibility from competing alongside traditional power generation in electricity markets.
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