10/25/2017 - EELP News - Faculty - Opinion

Jody Freeman and Joe Goffman on Perry’s Plan to Prop up Coal

EELP Director Jody Freeman and incoming Executive Director Joe Goffman call out Energy Secretary Rick Perry’s anti-market plan to prop up coal and nuclear power in today’s New York Times. This Trump administration attempt “to prop up the struggling coal industry by doing something very un-Republican — subsidizing it,” is based on flawed logic.

Perry justifies the plan using the unfounded assumptions that coal and nuclear power are more reliable because they can stockpile fuel, and that subsidies to renewable energy producers are driving coal and nuclear plants out of business.

These assumptions contradict a study recently released by the Department of Energy which found that renewable energy is not a threat to grid reliability, and that low natural gas prices are the primary driver of coal and nuclear plant retirements.

Perry’s so-called “Grid Resiliency Pricing Rule” invokes a rarely used authority that allows the Department of Energy to propose a rule under the Federal Power Act. If finalized, the rule would require wholesale electricity market operators to amend their rules to provide for a special rate for generators that have a 90-day fuel supply and can meet other qualifications. Freeman and Goffman conclude that “by putting a thumb on the scale for coal, Mr. Perry’s proposal would reverse 30 years of dogged work by successive FERC commissioners to promote fair competition in electricity markets.”

EELP recently commented against the rule.