FERC Says Energy Crisis Looming without Coal and Natural Gas Plants
Words used by the federal regulators were "catastrophic" and "the red lights are flashing".
Last Thursday, all four Federal Energy Regulatory Commission (FERC) commissioners–two Democrats and two Republicans–sat before the Senate Energy and Natural Resources Committee in a hearing and said the same thing regarding our future energy output.
During the committee hearing, all four FERC commissioners warned the Senators that too many coal- and gas-fired power plants are retiring without enough new sources coming online to replace them.
The words used to describe the situation is “catastrophic” and “the red lights are flashing.”
FERC Commissioner Mark Christie said the transition to cleaner energy is happening too fast and could have disastrous consequences.
“I think the United States is heading for a very catastrophic situation in terms of reliability,” Christie told members of the Senate Energy and Natural Resources Committee at a May 4 oversight hearing focused on FERC.
“The core of the problem is actually very simple. We are retiring dispatchable generating resources at a pace and in an amount that is far too fast and far too great and is threatening our ability to keep the lights on.”
In March 2022, National Rural Electric Cooperative Association CEO Jim Matheson warned the Senate Environment and Public Works Committee of the risks of energy shortfalls during extreme weather if too much baseload generation is retired prematurely.
“Such policies would have significant impacts on the reliability and security of the electric grid and could have an undue economic impact on co-op consumer-members, particularly as additional costs must be incurred for replacement generation,” Matheson said in March 2022.
Two weeks ago, House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA) and Energy, Climate, & Grid Security Subcommittee Chair Jeff Duncan (R-SC) sent a letter to Acting FER Chairman Willie Phillips and the other Commissioners demanding they return the agency to its core mission to help deliver abundant, reliable, and affordable energy for Americans.
Excerpt from the letter:
“Blackouts, brownouts, and energy rationing have become far too common in the past few years. The primary cause of the electricity shortages Americans have experienced in recent history is a lack of generation capacity. In other words, some regions do not have enough reliable, dispatchable generation to produce the electricity needed to support the bulk power system. These shortages often happen in the cold of winter or the heat of summer. This is due, in no small part, to the premature retirement of dispatchable generation resources, like coal, nuclear, and natural gas, and the rapid expansion of intermittent resources, like wind and solar, onto the bulk power system.”
“For the past several summers, the California Independent System Operator (CAISO) implements rolling outages to balance its lack of dispatchable generation with increasing demand for electricity. According to an Electric Power Research Institute (EPRI) study conducted in 2020, ‘[t]he CAISO supply deficiency was largely due to a resource adequacy issue.’ In a recent study conducted by the Midcontinent ISO, the grid operator highlighted the pervasive risk of capacity shortfalls across its system by noting it had a ‘1.2 gigawatt (GW) capacity shortage in the planning resource auction […].’ Additionally, the Southwest Power Pool (SPP) could potentially face energy shortfalls. According to the North American Electric Reliability Corporation (NERC), in SPP, ‘outages and reduced output from thermal and hydro generation could lead to energy shortfalls at peak demand.’
“The PJM Interconnection, the nation’s largest grid operator, recently issued a dire warning about the rapid pace of electric generation retirements within its service territory. In a report issued February 24, 2023, PJM notes, ‘retirements are at risk of outpacing the construction of new resources.…’ In the report, PJM projected 40 GW (40,000 MW) of retirements due to economic and policy factors, including regulations issued by the U.S. Environmental Protection Agency, state climate laws or regulations, as well as private sector Environmental, Social, and Governance commitments.”
Click here to read the letter.
Committee Republicans sent similar letters to FERC earlier this year demanding they abandon the accelerated rush to a green agenda and return to their core mission.
“I believe in an all-of-the-above approach,” replied FERC Chairman Willie Phillips, who was appointed to lead the commission in January by President Joe Biden. “Whatever resources are needed to keep our grid reliable, we have to make sure they are available.”
Commissioner James Danly said, “as things stand, coal is required.”