For much of last year, U.S. Energy Secretary Rick Perry pursued a plan that, in essence, would prop up the financially challenged U.S. coal and nuclear industries.
His proposal, submitted to the Federal Energy Regulatory Commission last fall, provided financial subsidies to electric-generation plants that kept 90 days of fuel onsite.
Natural-gas plants are supplied continuously via pipelines, and renewable-energy sources have no “fuel” on site, so that helped only plants powered by coal or nuclear energy.
CHECK OUT: Trump DoE to critique renewables against coal for grid reliability (Apr 2017)
On Monday, Perry’s plan was unanimously rejected by FERC. Its decision is binding and cannot be appealed.
The commission’s reasoning was that giving government-backed financial advantages to specific types of generation plants would interfere with natural competition on cost among numerous sources of electricity.
In other words, it would distort the free market.
Perry’s plan was part of several efforts by the DoE and the Environmental Protection Agency to comply with President Donald Trump’s campaign promise—so far unfulfilled—to “bring back coal.” (Or, as he called it at one point, “beautiful, clean coal.”)
The EPA has axed dozens of regulations limiting emissions and other pollution by coal-mining companies and power producers.
But a startling coalition of forces emerged to oppose the DoE proposal to bail out coal and nuclear plants that couldn’t compete on cost with natural-gas and renewable sources.
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Not only wind and solar trade groups but also natural-gas and oil-industry advocates joined together against the Perry proposal.
As The Washington Post noted on Monday, four of the five FERC commissioners who voted unanimously against the plan had been appointed by Trump.
Regulators have worked to establish competitive markets for electricity for 30 years, with multiple generation types competing to provide electricity at the lowest cost.
The language in FERC’s decision suggested, the Post wrote, that it had little interest in altering the competitive balance among those different sources.
The commission’s decision said “any change we make to the grid is going to be grounded in fact,” in the words of Greg Wetstone, president of the American Council on Renewable Energy.
“This is shifting to a real-world process based on what’s actually happening to the nation’s grid,” he told the Post, “and that’s great news for renewable energy.”
In fact, just the previous Friday, FERC had issued a new report suggesting that renewable energy generation in the U.S. might double in capacity as quickly as 2020.
With data through the end of November 2017, the commission’s Energy Infrastructure Update projected that new utility-scale solar and wind capacity could total 116,000 megawatts by December 2020.
That would double the current installed wind and solar capacity of 115.5 megawatts, it said—a total that exceeds the output of all the U.S. nuclear plants now operating.
Moreover, the report projected that 18.7 megawatts of coal generation capacity might be retired—or 6.6 percent of today’s total—and nuclear would drop by 2.3 megawatts, or 2.2 percent of capacity.
“The numbers were released as FERC prepares for a January 10 meeting to consider U.S. Department of Energy Secretary Rick Perry’s proposal for a bail out of the coal and nuclear industries,” the commission said in a press release.
FERC did request additional information about “resilience” of the national electricity grid, the primary reason cited by Perry’s study in proposing the regulations shot down on Monday.