ACC Statement on DOE Grid Reliability Study (8.24.17)
Monday, September 4, 2017
Posted by: Terry Headley
WASHINGTON, DC (August 24, 2017) – The Department of Energy staff report to Secretary Rick Perry provides a comprehensive view of the evolution and current status of the U.S. electricity marketplace and offers some important policy considerations to support grid operations in the future.
The report points to the Polar Vortex as demonstrating “the critical need for improved system resilience”. While finding that electricity markets now recognize and provide for reliability, more work is needed to recognize and compensate for resilience, including resources with fuel assurance.
Coal is a key fuel resource, and the ability to store it onsite at a power plant is an important attribute. The report recognizes that market factors, federal and state regulations and mandates, the impact of variable resources, and flat electric load growth have accelerated closure of baseload generation and may harm grid reliability and resilience without market and policy changes. Wholesale electricity markets are discussed extensively and the report notes that questions about revenue sufficiency and resilience “must be addressed quickly, before the fast-moving evolution of our power system outpaces our ability to understand and manage it responsibly.” The American Coal Council concurs – time is of the essence.
Another area the report addresses is infrastructure, with a recommendation for EPA to provide a regulatory environment that allows existing coal plants to improve efficiency and reliability without triggering new regulatory approvals (New Source Review). Recognition of this issue and the need to resolve it is important. This has been a barrier for many years and has contributed to decisions to retire rather than retrofit coal plants.
The American Coal Council appreciates Secretary Perry’s attention to the issues of our dynamic power sector marketplace. FERC, NERC, RTOs/ISO’s, federal and state agencies and other stakeholders must now expedite addressing the DOE report recommendations.