Energy trade associations blast ongoing coal, nuclear bailout plans

Officials from the American Petroleum Institute, Natural Gas Supply Association and eight other national energy business groups have strongly criticised ongoing Trump administration plans to keep otherwise failing coal-fired and nuclear power plants open ostensibly to assure electricity service will remain reliable nationwide.

They responded on the 1^st June after White House Press Secretary Sarah Huckabee Sanders said President Donald Trump has directed US Energy Secretary Rick Perry to take immediate steps to assure such power plants, which a discussion document that was leaked on the 29^th May called “fuel-secure,” continue operating.

Natural gas pipelines, by contrast, represent “a major point of vulnerability due to the limits of protection available to thousands of miles of pipeline networks,” the document alleged.

“Unfortunately, impending retirements of fuel-secure power facilities are leading to a rapid depletion of a critical part of our nation’s energy mix, and impacting the resilience of our power grid,” Ms Sanders said.

Gas’s total US power generation volumes in 2017 fell 7.5 from 2016’s 9,590 bcf % to 8,871 bcf after generally growing steadily since 1990’s 3,147 bcf, US Energy Information Administration figures show. Coal’s contribution, meanwhile, has fallen continuously after peaking at more than 1,041 million short tons in 2007.

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“Propping up aging and uneconomic power plants through the Defense Production Act, the Federal Power Act, or other unnecessary federal intervention is a short-sighted action that drives up customer costs and undermines well-functioning power markets,” said NGSA President Dena Wiggins.

Ms Wiggins said, “It is an inappropriate use of the federal government’s emergency powers that is even more egregious when even the regional power grid authorities at PJM Interconnection say there is no emergency.”

The regional transmission organisation based in Valley Forge, Pa., said on the 1^st June that it has received no official documents from the US Department of Energy, and that its analysis of plans to deactivate certain nuclear plants serving 13 states and the District of Columbia “has determined there is no threat to system reliability.”

Ms Wiggins said, “We need to move away from a narrow focus on resuscitating individual projects and refocus the discussion on what lies at the heart of resiliency – the ability to reliably serve power customers in the most cost-efficient manner over both the short and the long-term.”

API Market Development Group Director Todd Snitchler said, “The administration’s draft plan to provide government assistance to those coal and nuclear power plants which are struggling to be profitable under the guise of national security would be unprecedented and misguided.”

The US is on track to achieve the president’s energy dominance vision in no small part because gas has become the number one source of electricity, Mr Snitchler said. “However, unprecedented government intervention in the energy markets to support high-cost generation will put achieving that vision in jeopardy and hurt customers by taking more money out of their pockets,” he said.

Officials from the Advanced Energy Economy, American Council on Renewable Energy, American Wind Energy Association, Business Council for Sustainable Energy, Electricity Consumers Resources Council, Electric Power Supply Association, Energy Storage Association, and Solar Energy Industries Association also spoke out strongly against the idea.

They were joined by US Sen. Ronald Wyden (D-Ore.), who separately said it would bail out coal companies, blow up energy markets, and raise utility rates for American families.

“It’s bad enough gasoline prices have already risen under the Trump administration, but now the latest reports show Secretary Perry is doubling down on his absurd plan to blow up energy markets and raise utility rates to pad the wallets of his coal executive friends. This would be an egregious abuse of power,” Mr Wyden, the Senate Finance Committee’s ranking minority member said.

The US Federal Energy Regulatory Commission terminated a proceeding in early January that considered Perry’s, proposal of the 29^th September 2017 attempting to justify special treatment for coal and nuclear power plants to preserve electric grid power pricing and resilience.

FERC directed regional operators to provide information on whether they and FERC need to take additional action to make power grids more resilient instead.

In May early May API, NGSA, and the Interstate Natural Gas Association of America joined AEA, AWEA, and EPSA opposing Akron, Ohio-based First Energy Solutions’ petition of the 29^th March to Mr Perry for an emergency order to PJM which would financially secure the long-term capacity of FES and other utilities’ nuclear and coal-fired plants in the region.

Source: Oil & Gas Journal