DOE Takes Step to Extend Lives of Polluting Power Plants Under False Energy Emergency

Today, the Department of Energy (DOE) issued a methodology to analyze reserve power margins across the country that systematically undercounts the contributions of clean energy to meet the nation’s energy needs and protect system reliability. DOE plans to use this methodology to deem certain generators, likely coal and natural gas, as critical to system reliability, consistent with its recent actions.

Over the last few months, DOE has already started issuing orders under the Federal Power Act section 202(c) that would extend the lives of polluting power plants past their planned expiration dates. The orders falsely invoke emergency powers to upend the usual legal and regulatory decision-making process, requiring consumers to pay to operate plants that are not needed to meet reliability needs and that harm air quality and public health. DOE is now likely to renew these 202(c) orders and issue additional orders using the new methodology in order to continue preventing retirement of expensive, polluting power plants.

Coal, gas, and oil fired power plants spew millions of pounds of health-harming and climate-warming pollution into the air each year, and cost consumers millions of dollars more than cleaner energy sources. Extending the lives of aging fossil fueled power plants usurps the judgment of state regulators, the utility, state Attorneys General, and numerous other parties who negotiate and approve the settlements to retire these plants.

Additionally, accreditation methods approved by the Federal Energy Regulatory Commission (FERC) are typically developed by grid operators over months and even years of significant stakeholder input because these methods must take into account the different resource mixes, market constructs, and other conditions in a given region. DOE’s rushed one-size-fits-all approach — developed behind closed doors with no public input — is flawed and it could cost ratepayers an average of $2 billion or more every year without providing corresponding reliability benefits.

Recently, public interest groups challenged DOE’s illegal order to extend the J.H. Campbell power plant and Eddystone oil and gas power plant past their planned expiration dates.

Statement of Christine Powell, Deputy Managing Attorney for Earthjustice’s Clean Energy program: “Determining the reserve margin and ‘critical’ resources are complex decisions with severe health and economic consequences that Congress rightly entrusted FERC to oversee using a robust public adjudication process. Today’s methodology attempts to usurp that process, and would impose billions of dollars and harmful pollutants on consumers without any corresponding benefits for anyone except for the coal industry.”

Statement of Greg Wannier, Senior Attorney for the Sierra Club: “The methodology released today is another attempt to push the false narrative that our country is facing a so-called ‘energy emergency’, so that the DOE can continue bailing out the dying coal industry. The report does not provide any basis for the DOE to to bypass FERC and the regulatory process or forcibly keep coal plants online past their planned retirements — any effort by DOE to do so would be an extraordinary and unlawful overreach of its regulatory authority and would be costly, dangerous, and harmful especially to the communities near these power plants. We will continue to hold the DOE accountable for any decisions it makes that have severe, direct consequences on everyday Americans.”

Statement of Ted Kelly, Director and Lead Counsel, U.S. Clean Energy at Environmental Defense Fund: “The Trump administration is once again putting its thumb on the scale to help old, dirty power sources at the expense of air quality, public health, and higher energy bills for American families and businesses. This time it has issued a methodology that uses dodgy accounting to ignore all the clean energy we have at our disposal — including solar, wind, and battery technologies that are helping meet our nation’s energy needs and support the reliability of our electric grid — in order to make a bogus case that these old, dirty power plants are needed. The administration’s deeply flawed approach can’t hide the fact that clean energy resources are helping keep lights on and lower electricity bills across the country, while keeping old, dirty power plants on life support will mean higher power bills for families and more toxic, cancer-causing pollution in the air we breathe.”