FERC Notice of Proposed Rule Making on Reliability Pricing
December 14, 2017 | Lynn Abramson, President, Clean Energy Business Network
In September, Energy Secretary Rick Perry called on the Federal Energy Regulatory Commission (FERC) to write a rule by Dec. 11 that could impact electricity prices throughout the United States.
The Secretary’s proposal argues that the retirement of “fuel-secure” generation from coal and nuclear plants has made the grid more vulnerable to fuel supply disruptions, such as those that arose during the 2014 Polar Vortex. It urges FERC to use its authority under the Federal Power Act to propose rates for wholesale electricity sales and impose rules on independent system operators (ISOs) and regional transmission operators (RTOs) to “ensure that certain reliability and resilience attributes of electricity generation resources are fully valued.”
The new pricing regime would promote electricity-generation sources with a 90-day onsite fuel storage. Based on the criteria laid out, this pricing system would likely favor nuclear and coal power plants.
A large and diverse coalition of energy trade organizations—including solar, wind, petroleum, and utility groups—filed a motion to extend the public commenting period and convene a technical conference to explore these issues in more depth. However, the same day, FERC published a notice of proposed rulemaking (docket no. RM18-1-100) and invitation for initial public comments by October 23, 2017. 14 CEBN members submitted comments for the docket.
On December 7, 2017, newly seated FERC Chairman Kevin McIntyre, sent a letter to Energy Secretary Perry requesting a 30 day extension on the initial timeline, which requested a rule be drafted by December 11. Secretary Perry granted this request, pushing the deadline to January 10, 2018.
UPDATE Jan. 9, 2018: Click here for an update on this issue.
The Clean Energy Business Network (CEBN) works to advance the clean energy economy through policy, public education, and business support for small- and medium-size energy companies. Started in 2009 by The Pew Charitable Trusts, the CEBN is now a small business division of the Business Council for Sustainable Energy. The CEBN represents 3,000+ business leaders across all 50 U.S. states working with a broad range of clean energy and transportation technologies.