Published: Mon, June 04, 2018
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Trump Administration Mulls Coal, Nuclear Bailouts; Energy Groups React

Trump Administration Mulls Coal, Nuclear Bailouts; Energy Groups React

"Keeping America's energy grid and infrastructure strong and secure protects our national security, public safety and economy from intentional attacks and natural disasters", spokeswoman Sarah Sanders said in a statement.

President Donald Trump ordered Energy Secretary Rick Perry to take immediate action to stem power plant closures in the name of national security, arguing that a decline in coal and nuclear electricity is putting the nation's grid at risk.

Perry confirmed during congressional testimony last month that DOE was weighing its options for aiding coal and nuclear plants for national security purposes, including reviews of the DPA and FPA Section 202 (c).

Possible proposals include having the Department of Energy have grid operators buy electricity from struggling coal and nuclear plants for two years.

The draft memo asserts that "federal action is necessary to stop the further premature retirements of fuel-secure generation capacity" while DOE and other entities embark on further study of "national security needs and additional measures to safeguard the nation's electric grid and natural gas pipeline infrastructure from current threats".

The DOE measure would also create a "Strategic Electric Generation Reserve", which would shore up the U.S.'s domestic energy reserves in case of an emergency. After the Energy Department conducted a study of grid reliability a year ago, Perry proposed a rule that would have compensated coal and nuclear plants for their ability to store months' worth of fuel on site.

"It's high time someone realized the importance and the reliability of the grid".

One other coalition of power business teams representing the oil, pure fuel, photo voltaic, and wind industries issued joint statements saying the administration's plan is "misguided", "unwarranted", and "an train in crony capitalism". One impartial group that manages the electrical energy grid that serves greater than 65 million individuals stated that it might be unhealthy for shoppers if the federal authorities intervenes out there.

An increasing number of coal and nuclear plants have gone under in recent years while a cheaper and cleaner alternative, natural gas, has become more mainstream. Based on a leaked memo it appears Perry will deploy a pair of archaic, World War II- and Cold War-era laws to shelter certain plants from competition in the free market, likely mandating regional utilities to ensure that selected uneconomic coal and nuclear plants continue to operate. Nationwide, BNEF said, two dozen nuclear plants - representing almost 33 gigawatts - are either scheduled to close or probably won't make money through 2021.

The president heralded the coal industry during his campaign and his presidency, and he's frequently talked about trying to bring coal jobs back.

Soon after taking charge, new CIL chairperson Anil Kumar Jha said that the Power Ministry had set a daily supply level to ensure that every thermal power plant was carrying 22 days consumption of coal - the normative stock as laid down in standard operating procedures.

A common argument among opponents is that coal and nuclear units are not infallible during stresses on the system, and that transmission and distribution issues are more often the culprit when resilience issues arise, not generation or fuel supply concerns. It relies on authorities given to the executive branch in the Defense Production Act of 1950 and the Federal Power Act.

"In October 2017, I commended U.S. Energy Department Secretary Rick Perry and encouraged the Federal Energy Regulatory Commission to seriously consider the benefits of a diverse energy grid and the importance of reliable, fuel-secure sources of electricity when considering Secretary Perry's directive". "There is no need for any such drastic action", said a PJM spokesperson about the new idea.

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