Bipartisan Former FERC Commissioners Reject Energy Secretary Rick Perry’s Plans To Subsidize Coal

October 23rd, 2017 by Joshua S Hill

A bipartisan group of former Federal Energy Regulation Committee Commissioners have filed a letter with their former agency opposing a recent proposal filed by Department of Energy Secretary Rick Perry seeking to subsidize coal and nuclear plants.

A bipartisan letter signed by eight former members of the Federal Energy Regulation Committee (FERC) — including five former chairmen — filed with FERC last week seeks to oppose a recent proposal made by US Energy Secretary Rick Perry — itself, filed in the wake of the Department of Energy’s (DOE) own long-awaited August-released report into grid resiliency — seeking to subsidize the coal and nuclear industries under the Secretary’s false assumption that they both provide necessary grid resiliency and reliability.

The proposal made by Rick Perry has been met with unusually widespread opposition, across the fence, both within and without of FERC. “We worry today’s proposal would upend competitive markets that save consumers billions of dollars a year,” said Amy Farrell, Senior Vice President, Government and Public Affairs, American Wind Energy Association. “We’re concerned this proposed rulemaking uses grid resilience as an excuse to prop up plants that have not been shown to be needed, preventing consumers from buying the power they want to buy,” added Todd Foley, ACORE Senior Vice President, Policy & Government Affairs. Further, two FERC Commissioners — FERC Commissioner Rob Powelson and Cheryl LaFleur, another Obama-era appointed FERC Commissioner — similarly expressed their concern with Secretary Perry’s proposal.

Filed on October 19, eight former FERC members filed a letter (PDF) with their former agency highlighting the work already done by the Commission, but further expressly stating that Secretary Perry’s proposal “would be a significant step backward from the Commission’s long and bipartisan evolution to transparent, open, competitive wholesale markets.” Rather than pursuing “the worthy goal of a resilient power system,” adopting the proposal would, according to the former Commissioners, “disrupt decades of substantial investment made in the modern electric power system, raise costs for customers, and do so in a manner directly counter to the Commission’s long experience.”

The Commissioners acknowledge issues with the current situation but repeatedly urge the current FERC Commissioners to avoid adopting Secretary Perry’s proposal in favor of building up a forward-looking grid. “Subsidizing resources so they do not retire would fundamentally distort markets,” they write, commenting further that the “subsidized resources would inevitably drive out the unsubsidized resources, and the subsidies would inevitably raise prices to customers.”

“Accordingly, we urge you not to move forward with the published proposal, and instead address the issues of power system reliability and resiliency consistent with the Commission’s long history and in the transparent, bipartisan, policy-centered manner for which this Commission has long been respected,” the authors conclude.











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