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The Washington Examiner (opinion): As large energy consumers, we oppose power plant bailouts

Posted by Advanced Energy Economy on Jul 25, 2018
This Washington Examiner opinion piece looks at how the proposed power plant bailout could affect the price of electricity for large scale energy purchasers and the ripple effect such a cost would have on the U.S. economy. Devin Hartman (R Street Institute), John Hughes (Electricity Consumers Resource Council), AEE's Caitlin Marquis (Advanced Energy Buyers Group) penned the piece. Link to the full article here. Excerpts below:

Before the Trump administration issues any orders to bail out uneconomic power plants across the country, as the president has called for, let’s tally the winners and losers.

On the one hand, the plan would pay a small number of generators to stay in business long after the market would otherwise have told them they’re not needed. Good for them, and their fuel suppliers.

On the other hand, it would harm every other business and consumer in the country, including the nation’s largest manufacturers and energy users, by raising electricity costs and completely disrupting electricity markets. In other words: Bad for the rest of us.

The administration argues that bailing out uneconomic power plants is necessary to protect national security. But it has failed to provide any evidence to back that claim. Every organization charged with keeping the lights on, from regional grid operators to utilities to even the administration’s own grid regulators, agrees that markets are doing their job and that bailouts aren’t needed. Grid operators, market participants, state and federal regulators, and even customers are taking action to improve the reliability and resilience of electric power service. If direct government intervention into the markets were needed to address upcoming threats, these groups would be calling for solutions. Instead, regulators, grid analysts, and consumers are unanimous in opposing the administration’s proposed actions.If the administration sides with the interests of a handful of uneconomic and outdated power plants, it will turn its back on the affordable and reliable electricity that is the lifeblood of the economy and a competitive advantage for American businesses — businesses like those who are members of our organizations. This decision would increase the cost of doing business here at home by tens of billions of dollars annually.

Link to the full WE article here.

Topics: AEE In The News