FERC Says "Nope" to Perry's NOPR

It’s no secret that the Trump administration is pro fossil fuels. Between the appointment of EPA Administrator Scott Pruitt, who sued the EPA 14 times as Attorney General of Oklahoma, Secretary of Interior Ryan Zinke, and Secretary of Energy Rick Perry, anyone who cares about the environment and public health has been bracing for the worst.

And indeed, the actions of these men over the past year have harmed the preservation of public lands, human health, wildlife, the integrity of our scientific institutions, and the goal of bringing our carbon emissions down to sustainable levels. There is an almost absurd nature to the brazen manner in which Trump appointees have aimed to undermine our institutions and champion corporate interests over anything else. But despite their best efforts, occasionally, there are reasons to be hopeful.

Last September, Secretary Perry submitted a “Notice of Proposed Rulemaking,” also referred to as a NOPR, to the Federal Energy Regulatory Commission, or FERC. The NOPR suggested that in order to preserve the reliability of the electric grid, ratepayers would fund cost-recovery programs for power plants that had over 90 days’ worth of fuel on hand. Conveniently, this was a specification that applied only to nuclear and coal plants.

We’ve talked at length about the many reasons the coal industry has been in a state of decline, and an alleged “war on coal” is very clearly not one of them. (We have even sponsored reports on what opportunities exist in post-coal economies if you are interested.) Ultimately, coal is no longer cost-competitive with things like natural gas and utility-scale renewables, and is being pushed out naturally by market forces. It’s a win for the environment, public health, and the wallets of ratepayers. However, with the heavy-handed nature of this NOPR, Perry seemed to be aiming to prop up the coal industry through obtuse market intervention, forcing ratepayers to essentially bail out an industry that is due to retire and concede its former market dominance to cheaper, cleaner technologies.

The fundamental reasoning Perry cited for these new regulations was that grid reliability was dependent upon using coal and nuclear energy to sustain a base load of power. Though there has been no indication of this from utilities, regulatory committees, and independent system operators, Secretary Perry went ahead and ordered the Department of Energy (DOE) to carry out a study on the country’s grid reliability. The study found that coal and nuclear retirements hadn’t contributed to a reduction in grid reliability whatsoever. As FERC would later conclude in a statement: “…changes in the generation mix, including the retirement of coal and nuclear generators, have not diminished the grid’s reliability or otherwise posed a significant and immediate threat to the resilience of the electric grid.” Perry’s very basis for these proposed regulation changes had been debunked by his own Department of Energy.

Not be discouraged, Perry went ahead with the NOPR anyway. After months of deliberation, on January 8th, FERC unanimously rejected the NOPR, a huge victory for the environment, public health, and healthy markets. If approved, the NOPR would have given unjust advantages to nuclear and coal, and possibly hindered the rollout of utility-scale renewable energy sources. Given that four of the five FERC seats are Trump appointees, it’s genuinely hope-inspiring that in a time where our federal government seems intent on rejecting science, this commission sided with empirical reality and fair market regulations.

The renewable energy revolution is strong, and continues to gain momentum across the planet. Though private fossil fuel interests will undoubtedly continue to make efforts to slow the deployment of renewables, there are too many advantages to be reaped by too many people and utility companies to stop the adoption of affordable, renewable resources. We must continue to be vigilant, outspoken, and to resist unjust measures that aim to prop up outdated energy sources. But let’s also take hope in our victories such as this one. There is always reason to believe in a brighter, sustainable future.

Andrew Grandahl