Trump’s FERC Commissioners Disagree on Grid Reliability Plan

Several weeks ago U.S. Energy Secretary Rick Perry sent a letter to the Federal Energy Regulatory Commission (FERC) directing the agency to complete action on a “grid resiliency” pricing rule within 60 days. The proposed rule Perry proffered to FERC would put in place regulations that favor electric generating plants powered by coal and nuclear. That is, it would allow unprofitable ventures to pass along new costs, making them profitable–in the name of protecting the electric grid. The theory Perry (and by extension President Trump) subscribe to is that if the free market drives out coal and nuke plants, the electric grid would be “vulnerable” to far fewer sources to power it. If coal and nukes are all but gone, and all of sudden there’s a natural gas shortage, or prices spike for natural gas, it would endanger the electric supply in this country. On one side of the argument are those who believe the free market sometimes needs a helping hand (via regulation), and on the other those who believe the free market will sort it all out and we are not vulnerable. It’s no surprise that the coal and nuclear lobbies are celebrating Perry’s action, and the oil & gas lobby along with electric grid operators, are not (see Appalachian Grid Operators: We Don’t Need Trump’s Reliability Plan). The focus now is on FERC and what they will do. President Trump has appointed two members (so far) out of the three sitting FERC commissioners, with two more on the way. What do Trump’s appointees think, in general, about Perry’s grid reliability plan to favor coal and nukes? Neil Chatterjee, former aid to Kentucky Sen. Mitch McConnell (from coal country) and currently FERC Chairman, appears to favor the concept, going by remarks he made on Friday. However Rob Powelson, from Pennsylvania’s gas country, does not appear to favor Perry’s plan, going by remarks he made last week. Looks like Trump’s appointees may be headed for their first argument since getting hitched…

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