June 1, 2018

White House Whims Are Not Grounds for Emergency Coal, Nuke Plant Bailouts

Statement by Mike Jacobs, Senior Energy Analyst, Union of Concerned Scientists

WASHINGTON (June 1, 2018)—The White House is planning to issue a directive to the Department of Energy (DOE) that forces the agency to require electricity grid operators to buy power or capacity from uneconomical power plants for two years, according to news reports. President Trump’s mandate would force the DOE to implement two emergency-only provisions—the Federal Power Act and the Defense Production Act—to once again attempt to bail out coal-fired and nuclear power plants.

Below is a statement by Mike Jacobs, senior energy analyst at the Union of Concerned Scientists.

“This attempt to turn an era of cheap, abundant electricity into an emergency should be seen for what it is—a scare tactic, pure and simple.

“Energy Secretary Perry is being forced to issue another unnecessary and unprecedented emergency order to favor coal and nuclear over more economic electricity suppliers, including renewables. The Federal Power Act, which ensures a reliable power supply after sudden emergencies, is not meant to insulate uneconomic power plants from market forces. The Energy Department has primarily used that authority to address major power outage events and shortages, such as the California energy crisis in 2000 and the Northeast blackout in 2003. Abusing this authority to bail out uneconomic power plants for such an extended time makes no sense, especially when most regions of the country are awash with excess electricity.

“The Energy Department has already tried to tip the scale in favor of uneconomic coal and nuclear power plants to provide a totally unnecessary ‘resilience’ benefit. That attempt was rightfully denied by the Federal Energy Regulatory Commission, which determined that market rates and processes are indeed sufficient to meet national energy demand.

“The Trump administration is trying, once again, to fleece ratepayers by giving coal and nuclear power plants billions of dollars in guaranteed profits. It’s absurd to force consumers to bail out money-losing plants when grid operators are having no problem keeping the lights on.”

The Union of Concerned Scientists puts rigorous, independent science to work to solve our planet's most pressing problems. Joining with people across the country, we combine technical analysis and effective advocacy to create innovative, practical solutions for a healthy, safe, and sustainable future.