Published on January 9th, 2018 | by Steve Hanley0
FERC Thumbs Its Nose At Rick Perry’s “Grid Resiliency” Plan
January 9th, 2018 by Steve Hanley
It is almost beyond belief. The Federal Energy Regulatory Commission, which is dominated by Republican appointees, has told Energy Secretary Rick Perry in no uncertain terms to take his grid resiliency plan and shove it. Back in 2014, a phenomenon known as the Polar Vortex brought bone-chilling temperatures to much of the United States. Low temperatures affected some pipelines carrying natural gas to generating facilities, causing concerns that the supply of electricity might be at risk.
Last September, Perry ordered FERC to immediately consider a proposal giving significant subsidies to coal and nuclear generating stations because they are able to keep more than a 90 day supply of fuel on hand. In theory, that meant those electricity suppliers could keep the lights on even if a natural disaster interrupted natural gas supplies. In reality, the Perry plan represented a huge giveaway to operators of aging power plants, one that would cost ratepayers billions and allow those facilities to limp along a little while longer instead of being shut down.
On January 8, FERC had an answer for Perry and his grid resiliency plan — “horse puckey,” it said, but in more polite language. “There’s agreement at the commission that the DOE proposal wasn’t sufficient. It was unanimous,” said commissioner Richard Glick after the decision was made public. According to Bloomberg, the commission did throw Perry one bone. “We appreciate the Secretary reinforcing the resilience of the bulk power system as an important issue that warrants further attention.”
Grid resiliency is an important issue, but paying people to keep facilities operating that are no longer economically viable is not the way to address it. The Perry plan was opposed by most Regional Transmission Organizations and Independent System Operators — the people who actually operate the electrical grid and know how to keep it functioning.
A report by CNBC says the FERC decision highlighted this point. “While some commenters allege grid resilience or reliability issues due to potential retirements of particular resources, we find that these assertions do not demonstrate the unjustness or unreasonableness of the existing RTO/ISO tariffs. In addition, the extensive comments submitted by the RTOs/ISOs do not point to any past or planned generator retirements that may be a threat to grid resilience.”
What the commissioners did do was ask the professionals — those RTOs and ISOs — to make recommendations within 60 days regarding the steps they think need to be taken to insure grid resiliency in the future. PJM Interconnection, which operates the grid in 13 northeastern states and Washington, DC, is one ISO that supports some of Perry’s proposals, so the issue isn’t dead yet. But the Perry plan — and by implication the mania for coal power expressed by Donald Trump — has been dealt a serious setback.
Perry could have asked the professionals for their advice in the first place, but that is not the “shoot first and ask questions later” method the Trump administration prefers. Will the FERC decision restrain the Trump cowboys in any meaningful way? Don’t bet on it. Expect a tweet excoriating the Commission from the vicinity of the Oval Office soon … unless he’s too busy with other things.