FERC Commissioner Voices Reliability Concerns Over EPA Plan

FERC Commissioner Voices Reliability Concerns Over EPA Plan

The FERC commissioner noted that in July, he testified before Congress on the EPA's proposed rule, which is known as the Clean Power Plan (CPP).

Philip Moeller, a member of the Federal Energy Regulatory Commission, is voicing concerns about the reliability implications of a U.S. Environmental Protection Agency plan to reduce carbon dioxide emissions from existing power plants. Moeller outlined his thoughts in a Dec. 1 letter to Gina McCarthy, administrator for the EPA.

The FERC commissioner noted that in July, he testified before Congress on the EPA's proposed rule, which is known as the Clean Power Plan (CPP). In his testimony, he expressed concerns about the reliability implications of the four compliance "building blocks" and his concern that state implementation plans will be extremely inefficient in a system of interstate regional electric markets.

Other concerns relate to the front loaded timeline that as proposed will require the bulk of system changes by 2020, Moeller said.

Another "fundamental problem" is that the proposed plan "seems to assume that a significant amount of new natural gas pipelines needed to fuel power plants, along with a similarly significant expansion of the nation's electric transmission system will suddenly appear so as" to meet the new demands under the proposed plan.

"Such an assumption ignores the very real challenges we currently have in expanding these categories of energy infrastructure," Moeller said.

Since July, "my concerns have only increased based on comments from a wide range of stakeholders. Especially persuasive are comments from the regional grid operators including RTOs and ISOs, and from individual states that foresee immense challenges in complying with the proposed rule."

Moeller noted that he is concerned that the costs of the proposed EPA plan "could total hundreds of billions of dollars."

But his primary concern relates to implications of the proposed plan on the reliability of the nation's electricity system, he said in his letter to McCarthy.

"I continue to call for a more formal and transparent process involving FERC (and not just its staff) to examine these reliability implications. The laws of physics will trump any paper regulations or laws," Moeller said. "There is a need to involve electric engineering expertise for an open dialogue and debate over what changes to the grid and energy network are feasible and cost-effective in a reasonable time frame."

The FERC commissioner said that he appreciates the outreach that EPA officials have undertaken "with our state colleagues through the National Association of Regulatory Utility Commissioners. Again, a more formal process with FERC and others as described in my testimony will help promote a CPP that does no harm to the reliability of the electric system in a more cost-effective manner."

The deadline for parties to file comments on the proposed plan at EPA was Dec. 1. For its part, the American Public Power Association said in its comments that if implemented in its current form, EPA’s proposed rule "will create economic inefficiency, impose additional costs on electricity customers, threaten the reliability of the electricity system, and force risky over-reliance on a single fuel — natural gas — to generate electricity."

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