The United States’ energy regulator, brought to full strength in August by the Trump administration, is rushing its consideration of subsidies for American coal- and nuclear-powered electricity generation, while ducking a court order that it consider the downstream climate effects of a proposed natural gas pipeline.
U.S. Energy Secretary Rick Perry proposed the subsidy regime last week in a letter to the Federal Energy Regulatory Commission (FERC). Perry urged the regulator to give utilities operating so-called ‘baseload’ generation a price bonus if they keep at least 90 days of fuel supply on hand. The proposal, which favours coal, nuclear, and hydroelectric facilities, reflects the former Texas governor’s widely-contradicted premise that the removal of such large central plants from service endangers the stability of electric grids.
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Now the agency seems determined to put Perry’s wish into law with minimal review. “FERC is asking for initial comments on DOE’s proposed rule to be submitted in just three weeks,” Politico reports, “a timeline that suggests the independent commission is eager to move quickly on the Trump administration’s proposal.” FERC said comments on the new policy would have to be received by October 23, and replies to comments by November 7.
One reason for haste: Perry’s idea “is already generating pushback from a diverse group of major industry players.” Politico notes.
Calling FERC’s deadline “unreasonable”, 11 U.S. trade associations, including the American Petroleum Institute, the American Council On Renewable Energy, the American Wind Energy Association and the Solar Energy Industries Association call its pending decision, “one of the most significant proposed rules in decades” that, if finalized, would affect millions of consumers and hundreds of thousands of businesses.
“Given the importance and complexity of this topic, any comment period should be at least 90 days,” the groups wrote in a motion filed with the commission on Monday. The associations also want FERC to hold a “technical conference” before time runs out on comments, “so that stakeholders would better understand the proposal.”
Meanwhile, FERC has found a way to deflect an appeal court directive issued in August, instructing it to reconsider its approval last year of the Southeast Market Pipelines Project, which would deliver natural gas to Florida. The District of Columbia Court of Appeals instructed the regulator to “properly analyze the climate impact from burning the natural gas that the project would deliver to power plants.”
Last week, FERC issued a supplemental environmental review that conceded that building and operating the pipeline would “result in temporary and permanent impacts on the environment,” but did not alter its approval for the project. FERC concluded, according to Utility Dive, that “with sufficient mitigation measures, ‘operating the SMP Project would not result in a significant impact on the environment.’”
In reaching that conclusion, however, the agency sidestepped one of the most commonly-applied measures of how greenhouse gases released from any source might affect people in its service area (recently struck by Hurricane Irma) and beyond: the social cost of carbon. The measure, necessarily a rough one, estimates the damage to society from the climate change initiated by the release of each additional unit of carbon dioxide, or its equivalent in other greenhouse gases.
Although FERC concluded that several pipeline projects in Florida could increase its greenhouse gas emissions by between 3.7% and 9.7%, it “declined to utilize the social cost of carbon (SCC) calculation devised by the Obama administration, saying no consensus exists for the appropriate discount rate for analyses and there are no established criteria identifying monetized values to consider.”
