FERC Was Right to Reject DOE Proposal to Bail Out Coal Plants
WASHINGTON (January 8, 2018)—The Federal Energy Regulatory Commission (FERC) unanimously rejected the U.S. Department of Energy (DOE) proposal to force energy markets to provide failing coal-fired power plants and nuclear plants guaranteed profits—at the cost of consumers. DOE Secretary Rick Perry asked FERC last September to essentially bailout these plants, in a move that would have benefited the owners of coal and nuclear power plants, rather than consumers, and jeopardized competitive wholesale electricity markets.
Below is a statement by Mike Jacobs, senior energy analyst at the Union of Concerned Scientists.
“Federal regulators were right to reject a proposal that would have amounted to nothing more than giving coal and nuclear power plants billions of dollars in guaranteed profits at the expense of consumers. We don’t need to prop up plants that are closing due to market forces. Grid operators are having no problems keeping the lights on as more of the nation’s energy comes from clean, renewable sources.
“Energy regulators must follow the law and act on the best available science, and not pick winners and losers based on political alliances. Secretary Perry’s attempts to tip the scale in favor of uneconomic coal and nuclear power plants to provide a “resilience” benefit that doesn’t exist would have increased carbon emissions, raised costs to consumers, and distorted competitive markets.
“The question for FERC was: are you pro-markets and pro-solutions, or do you support old technology? It’s crucial to maintain market competition to generate solutions that fit unique energy demands. FERC’s decision is a step in the right direction in forward-looking improvements for a cleaner, more resilient and reliable electricity grid.
“If we’re going to adjust prices to value resilience, let’s be smart and get public benefits out of the changes. Rather than limiting contributions from certain energy sources, such as renewables, FERC must continue to consider what is best for consumers, drives private investment and protects the environment.”