WASHINGTON — The Federal Energy Regulatory Commission issued an order Monday rejecting recommendations made by Energy Secretary Rick Perry aimed to protect coal and nuclear power facilities from retirement.
Perry put forward a proposal in September which would have required regional power transmission operators to establish a system for purchasing energy and recovering costs for facilities that store a 90-day fuel supply on site.
Perry cited the 2014 polar vortex and retirement of coal and nuclear plants as reasons for his decision. An August Department of Energy report pointed to the increased use of natural gas as the biggest reason for the closure of these facilities, as natural gas costs less and presently more abundant. The report also mentioned a low growth in electricity demand.
According to the U.S. Energy Information Administration, natural gas facilities generated 33.8 percent of the United States’ electricity in 2016, compared to 30.4 percent created at coal power plants.
The commission, in which four of the five members were nominated by President Donald Trump, ruled while it is concerned about making sure the nation’s energy grid can be maintained, there does not appear to be any past or present retirements that threaten the electricity grid.
“Resource turnover is a natural consequence of markets, and the reduced prices that result from greater competition are a benefit to customers, not a problem to solve, unless reliability is compromised,” said commissioner Cheryl LaFleur, a Democrat serving on the commission.
“Keeping up with these changes by ensuring that market tariffs and reliability standards sustain both reliability and just and reasonable rates in a time of changing resources has been a major focus of the Commission, and must continue to be,” she added.
Commissioner Richard Glick said propping coal and nuclear facilities would not improve the system’s resilience.
“The addition of a diverse array of generation resources, including natural gas, solar, wind, and geothermal, as well as maturing technologies, such as energy storage, distributed generation, and demand response, have in many respects contributed to the resilience of the bulk power system,” he said.
Commissioners asked regional transmission operators and independent system operators to submit comments on the resiliency of their area within 60 days.
U.S. Rep. David McKinley, R-W.Va., issued a statement sharing his disappointment with the commission’s decision.
“This proposal was a clear recognition that reliability, resiliency, and fuel diversity are vital to our economic and national security. Coal and other baseload energy sources have attributes that are essential to the reliable delivery of electricity,” he said.
Mary Anne Hitt, the director of Sierra Club’s Beyond Coal campaign, called the move “a return to reality” for coal and nuclear plant owners.
“We doubt that this will be their last attempt to bailout their failing plants, so we are preparing for their next round of dangerous proposals,” she said in a press release.