FERC Warns Congress Grid Facing ‘Catastrophic’ Failure From Plant Closures, Renewables

On May 4, members of the Federal Energy Regulatory Commission delivered stark warnings to the members of the Senate Energy and Natural Resources Committee.

The agency’s acting chairman, Willie Phillips, told the senators, “We face unprecedented challenges to the reliability of our nation’s electric system.” [emphasis, links added]

FERC Commissioner Mark Christie echoed Phillips’ warning, saying the U.S. electric grid is “heading for a very catastrophic situation in terms of reliability.”

His colleague, Commissioner James Danly, averred that there is a “looming reliability crisis in our electricity markets.”

The commissioners pointed to several factors for the reliability crisis, including numerous coal plants that are being retired prematurely, insufficient pipeline capacity to assure natural gas can be delivered to power plants, insufficient high-voltage transmission capacity, and distortions in the electricity market caused by massive federal subsidies for weather-dependent renewables.

On the last point, Danly told the senators, “FERC has allowed the markets to fall prey to the price distorting and warping effects of subsidies and public policies that have driven the advancement of large quantities of intermittent renewable resources onto the electric system.”

In his written testimony, Danly went further, saying “Most of these market-distorting forces originate with subsidies — both state and federal — and from public policies that are otherwise designed to promote the deployment of non-dispatchable wind and solar assets or to drive fossil-fuel generators out of business as quickly as possible.”

Danly continued: “The subsidies available to renewable generators are so lucrative that, when participating in procurement auctions, they are able to offer at a price of zero instead of their actual cost. The market signal thereby created is that these new resources can be built for free, and thus the cost of power is also free. This, of course, is untrue, and the inevitable consequence is market-wide price suppression. The price suppression deprives other market participants of much-needed revenue, leading to the premature retirement of the dispatchable generators which have to offer into the market at their true costs in order to remain viable.”

During questioning of the FERC commissioners, the chairman of Senate ENR, Joe Manchin, the Democrat from West Virginia, asked all of the commissioners a simple question: can the electric grid as it exists today be reliable without coal-fired generation?

All of the commissioners said no, with Christie saying “We need to keep coal for the foreseeable future.”

Exactly one week after that May 4 hearing, the Environmental Protection Agency announced a proposed rule that could force the closure of every coal-fired power plant in America as well as most of the natural gas plants if they cannot cut their emissions by 90%.

Here’s how Politico reported on it: The new rule will require “most fossil fuel power plants to slash their greenhouse gas pollution 90% between 2035 and 2040 — or shut down.”

Thus, at the same time, FERC commissioners are warning of catastrophic failures on the U.S. electric grid, the EPA under President Joe Biden wants to implement rules that could — repeat, could — force the closure of 90 percent of the hydrocarbon-fueled power plants in the country.

That would be catastrophic. Last year, hydrocarbon-fueled power plants in the U.S. generated 2,518 terawatt-hours of energy, which was about 59% of all the juice produced in the country. (Coal plants produced about 829 terawatt-hours and gas-fired generators produced 1,689 terawatt-hours.)

If we take 90% of the 2,518 terawatt-hours produced from coal and gas plants, we get 2,266 terawatt-hours of electricity per year.

As can be seen in the graphic above, the 2,266 terawatt-hours of energy that we generate from hydrocarbons every year is more than 10 times the amount of juice now being produced by all of the solar panels in the country.

It’s also more than five times more than what’s being produced by wind turbines, and nearly three times more than what’s being generated by all of our nuclear plants.

The EPA’s proposed rule hinges on the dubious claim that carbon capture and sequestration (CCS) is ready for prime time.

Politico reporter Alex Guillén explained that to “justify the size of those cuts, the agency says fossil fuel plants could capture their greenhouse gas emissions before they hit the atmosphere — a long-debated technology that no power plant in the U.S. uses now.”

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