Energy Secretary Rick Perry is attempting to keep coal alive under the guise of grid resiliency, but the largest grid operator in the United States called on regulators to scrap the plan. PJM Interconnection CEO Andrew Ott called Perry’s pricing proposal unworkable and discriminatory, and even said it’s inconsistent with federal law. Multiple other grid operators have also called for its rejection.
Perry has urged the Federal Energy Regulatory Commission (FERC) to alter how wholesale power markets price electricity – so some nuclear and coal generators can recover costs, according to Bloomberg. Perry’s plan would attempt to reward power plants able to store 90 days of fuel supplies onsite. Ott told reporters, “I don’t know how this proposal could be implemented without a detrimental impact on the market.”
Ott said it seems the rule targets PJM – between 2011 and 2016, they retired over 19 gigawatts of coal-fired power, according to Bloomberg. But “the PJM market is more diverse and reliable today than we’ve seen,” Ott said. PJM serves over 65 million people in over a dozen states in the Midwest to Mid-Atlantic.
Bloomberg said hundreds of energy companies commented on the proposal, with firms like ExxonMobil, Anadarko Petroleum, and Devon Energy pointing to the low cost and reliability of natural gas. The Solar Energy Industries Association said nuclear and coal plants aren’t invulnerable to outages.
FirstEnergy supported Perry’s plan because they said the grid will be at risk if nuclear and coal plants are retired. They operate several coal plants in the PJM market.
Grid operators like the New York Independent System Operator, the Midcontinent Independent System Operator, and ISO New England called for FERC to toss out Perry’s plan as part of a coalition that also included organizations the proposal wouldn’t impact, such as the California Independent System Operator, the Electric Reliability Council of Texas, and the Southwest Power Pool.