Trump orders Energy Department to help ailing coal, nuclear plants

Trump orders action to stem shutdowns of coal and nuclear power plants

Groups like the American Coalition for Clean Coal Electricity have told the Energy Department that retiring coal facilities could threaten the electrical grid.

The Nationwide Safety Council reportedly mentioned a draft memo on Friday, reported by Bloomberg Information, that may direct electrical grid operators to buy electrical energy from coal, nuclear, or oil-fueled services susceptible to closing. The recent "bomb cyclone" system of extremely cold weather in the northeast this winter showed off that the grid could operate well despite coal retirements.

Although the memo describes a planned Energy Department directive, there was no indication President Donald Trump had signed off on the action nor when any order might be issued.

The draft memo from DOE takes the stance that while renewable energy and natural gas have their share of benefits, increased reliance on them "comes at the expense of fuel security and resilience", which the document defines as the grid's ability to withstand and recover from major disruptions, be it adversarial attacks or natural disasters. The justification for using the Defense Production Act would be that keeping unprofitable power plants running is a matter of national security until the two-year vulnerability study is complete.

As renewable energy and natural gas has become very low-priced, some coal and nuclear plants can no longer compete economically and are retiring early unless heavy-handed intervention, such as what was just proposed by the Administration, comes to the "rescue".

Over dozens of pages, the memo makes the case for action, arguing that the decommissioning of power plants must be managed for national security reasons and that federal intervention is necessary before the USA reaches a tipping point in the loss of essential, secure electric generation resources. That estimate was provided by Robbie Orvis, director of energy policy design at Energy Innovation, according to the Times. And on April 2, 2018, First Energy appealed for emergency help after a subsidiary containing ailing power plants filed for bankruptcy protection.

Over the two years in question, DoE officials would ostensibly research United States power grid network vulnerabilities, using the study as a justification to keep unprofitable and polluting power plants running as a matter of national security, according to Bloomberg. "This needlessly raises costs for consumers and merely shifts the risk of premature retirement to newer, more efficient power plants that compete with coal and nuclear".

The issue is a priority for some of the president's top supporters, including coal moguls Robert E. Murray and Joseph Craft of Alliance Resource Partners, who donated a million dollars to the president's inauguration.

"There is no need for any such drastic action", the company said.

According to data from the Energy Information Administration, coal consumption has fallen about 20 percent compared to previous year, from about 149,200,000 short tons in the first two months of 2017 to just under 119,600,000 short tons in the first two months of 2018. That attempt was rightfully denied by the Federal Energy Regulatory Commission, which determined that market rates and processes are indeed sufficient to meet national energy demand.

Opponents of the new plan contend the intervention is a solution in search of a problem and argue there are other ways to back up the grid. "Any federal intervention in the market to order customers to buy electricity from specific power plants would be damaging to the markets and therefore costly to consumers".

Representatives of FirstEnergy did not immediately respond to emails seeking comment. And it is the biggest dumb move by this administration I have seen, at least since yesterday - when Trump effectively made all our allies angry with his ridiculous trade tariffs. Tapping two statutes simultaneously also could give the administration more "legal room", Peskoe said.

The Defense Production Act, adopted in 1950 at the start of the Korean War, allows the federal government to intervene in business to promote national security.

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