Biden EPA’s Clean Power Push Getting Push-Back from Grid Operators, FERC, and Maybe the Courts

 

     I have often noted that the Biden administration’s clean power push is too ambitious and that a slower, more gradual, and smarter transition to clean power is needed to retain power system reliability. That push should retain as much natural gas as possible, including natural gas from the most efficient type of natural gas plant, large H-Class turbine-based combined-cycle gas plants. The goal of relegating natural gas plants to low utilization rates in favor of intermittent renewables is a stated strategy of those who favor deep decarbonization. It would be expensive for utilities to lose more revenue from these efficient and reliable thermal power plants. Operating efficient combined-cycle plants like simple-cycle plants makes them unnecessarily inefficient and wastes their potential as baseload energy sources. A slower energy transition also means slower increases in energy costs for consumers, and I know I can’t afford to pay more right now.

     With looming power demand increases imminent from AI, EVs, and other electrification, the need for more dispatchable power is beginning to grow. It’s clear that wind, solar, and batteries will not be able to keep up. Reserve margins for extreme heat or extreme cold events are not always maintained to desirable levels. A single major failure in this regard can lead to multiple human deaths.  

     An amicus brief was filed by four major regional grid operators supporting the ‘red state’ challenge to the rule and arguing the rules will make it harder for all to secure reliable power.

The issue is stated clearly:

 

“Their proffered brief outlines in detail that without additional modification, the compliance timelines and related provisions of the Rule are not workable and are destined to trigger an acceleration in the pace of premature retirements of electric generation units that possess critical reliability attributes at the very time when such generation is needed to support ever-increasing electricity demand because of the growth of the digital economy and the need to ensure adequate back-up generation to support an increasing amount of intermittent renewable generation,” the grid operators wrote in their amicus brief. “Such inevitable and foreseeable premature retirement decisions resulting from the Rule’s timelines will substantially strain each of the Joint [independent system operators’] / [regional transmission organizations’] ability to maintain the reliability of the electric power grid to meet the needs of the citizenry and the country’s economy.”

 

     The brief was filed by a big majority of U.S. power system operators: Midcontinent Independent System Operator (MISO), PJM, Southwest Power Pool (SPP), and the Electric Reliability Council of Texas (ERCOT). They argue that the requirements for coal plants to reduce emissions by 90% by 2032 are not feasible so those plants would have to be closed and likely be replaced by natural gas plants. The rule is relying on a fast and effective CCS technology rollout, which is not guaranteed. The cost alone of CCS will probably keep that rollout slow. CCS may well become successful and able to help reduce emissions, but it won’t happen fast enough to meet these ambitious targets. Thus, the rule is not undergirded by feasibility.

     The combination of retiring baseload generation, increasing power demand, reliability concerns, and the need to keep reserve margins for extreme events could be a recipe for disaster. That FERC Commissioner Mark Christie is worried about such a scenario shows that the Biden EPA plan is out of whack. The main issue is the “inevitable and foreseeable premature retirement decisions.” It is simply that the timelines are not feasible. Power grid planning and management is complicated and very sensitive to changes in the availability of dispatchable power generation. Forcing a big chunk of that available dispatchable generation offline while demand for it is increasing is not wise or warranted. I have argued before that the U.S. power grid has been decarbonizing at a steady rate for many years now and will continue to do so. Trying to speed up that process at the expense of reliability is not necessary. Coal plants will continue to be retired but some are more vital and needed than others. I think that the best course of action is for the EPA to stop, review, and reevaluate its plan and timelines in light of what the grid operators and Biden-appointed FERC chairman are saying.

 

 

 

References:

‘Inevitable And Foreseeable’: Grid Operators Beg Court To Nix EPA Rules To Save Electricity System From Collapse. Nick Pope. Daily Caller. September 17, 2024. ‘Inevitable And Foreseeable’: Grid Operators Beg Court To Nix EPA Rules To Save Electricity System From Collapse (msn.com)