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Rick Perry’s plan to make taxpayers bail out coal and nuclear rejected by federal agency

The decision was unanimous.

U.S. Secretary of Energy Rick Perry speaks during a White House press briefing. CREDIT: Alex Wong/Getty Images
U.S. Secretary of Energy Rick Perry speaks during a White House press briefing. CREDIT: Alex Wong/Getty Images

The Federal Energy Regulatory Commission (FERC) unanimously rejected Energy Secretary Rick Perry’s plan to raise consumer energy bills in order to subsidize coal and nuclear power plants — a major blow to the Trump administration’s effort to slow the growth of solar and wind power.

Back in September, Perry asked FERC, which oversees the U.S. grid and regulates interstate electricity transmission, to adopt a new federal rule that would require Americans to buy more coal and nuclear power, a taxpayer bailout at the expense of cheaper renewable sources (and natural gas).

To make the case for his new rule, Perry had to fabricate an economic threat to U.S. grid reliability from cheap renewables and then propose a rule to account for the supposedly undervalued reliability benefit of coal and nuclear power. That meant Perry also had to ignore his own grid study, which had made clear renewables were not a threat to power reliability.

But FERC, by a vote of 5-0 on Monday, didn’t buy that logic. The unanimous vote is especially notable since 3 of the 5 commissioners are Trump appointees, including the new chair.

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The rule-making explains all of the measures FERC has been taking to maintain grid reliability — while also keeping electricity prices low through market competition. It directly rejects the notion that power prices needed to be tweaked to reward coal and nuclear, saying the Proposed Rule did not satisfy “the threshold statutory requirement of demonstrating” that the grid operators’ current pricing schemes “are unjust and unreasonable.”

FERC goes even further, slapping down the core of Perry’s argument, namely that somehow cheap renewables (and natural gas) are forcing essential coal and nuclear plants to be shut down. They note that “the extensive comments submitted” by the grid operators “do not point to any past or planned generator retirements that may be a threat to grid resilience.”

The commissioners add, “It also has not been shown that the remedy in the Proposed Rule would not be unduly discriminatory or preferential.” If you remove the double negative, they are saying that Perry’s plan would be unduly discriminatory or preferential, which, of course, was the whole point of the plan.

FERC did announce it would start a new proceeding to “take additional steps to explore resilience issues” in the bulk grid system.

Commissioner LaFleur, in a concurring opinion, said that while grid reliability has always been his top priority, subsidizing the electricity dinosaurs was not the FERC’s job: “I believe the Commission should continue to focus its efforts not on slowing the transition from the past but on easing the transition to the future.”