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Wall Street Journal: Energy Department Prepares New Plan to Prop Up Nuclear, Coal-Fired Power Plants

Posted by Tim Puko on Jun 1, 2018

Tim Puko reports: The Energy Department is proposing a new plan to bail out failing nuclear and coal-fired power plants by forcing grid operators to take the electricity they produce, a move that could upend competitive power markets and raise prices for consumers.

The plan—a draft now under White House review—isn’t the first attempt by President Donald Trump’s administration to help coal and nuclear businesses. Its goal is to stop a wave of plant closings for two years while the Energy Department studies which plants nationwide are critical to ensuring reliable power in case of attack or natural disaster. Administration officials say grid reliability is a national security issue....

Tim goes on to explain competitive market dynamics, prior Administration efforts to support coal and nuclear plants, and includes AEE's perspective:

Mr. Trump’s efforts so far have been blocked by the Federal Energy Regulatory Commissionand fought by a broad coalition of opponents.

The country’s largest grid operator is also skeptical. “Our analysis…has determined that there is no immediate threat to system reliability,” PJM Interconnection LLC, which runs the power markets in 13 states across the mid-Atlantic and Midwest, said in a statement. “There is no need for any such drastic action.”

Opponents say these types of plans undermine the competition in power markets that has lowered prices and that they could raise consumer costs by billions of dollars in an attempt to fight a problem that may not materialize. Those groups, including consumer advocates, the oil-and-gas lobby and renewable power companies, said Friday the newest proposal creates the same concerns.

“The Administration’s plan to federalize the electric power system is an exercise in crony capitalism taken solely for the benefit of a bankrupt power plant owner and its coal supplier,” said Malcolm Woolf, who oversees policy at Advanced Energy Economy, a trade group representing business consumers.

See the entire Wall Street Journal story here (subscription required).

Topics: AEE In The News