Energy Secretary Rick Perry has directed his department to examine whether subsidies, wholesale markets or other incentives may be skewing electric markets to favor one electricity power source over another or make the electric grid less resilient.
Perry on April 14 ordered the Dept. of Energy to complete a study within 60 days of “critical issues central to protecting the long-term reliability of the electric grid.” Perry did not specifically cite renewable power but says there are concerns about the grid’s “diminishing diversity.” He said, “This has resulted, in part, from regulatory burdens introduced by previous administrations that were designed to decrease coal-fired power generation.” Perry also said federal subsidies are creating “acute and chronic problems” for maintaining base-load power from coal, nuclear and natural-gas-fired power plants. In addition to the loss of dozens of coal-fired plants, some nuclear plants are closing because their operators say they are not being fairly compensated in the marketplace.
Separately, the Federal Energy Regulatory Commission scheduled a May 1-2 conference to address how wholesale power markets are affecting the sale of electricity. The American Council on Renewable Energy said it is “puzzled” by Perry’s order because studies have shown the grid is resilient and that low natural-gas prices, not policies or incentives, have made coal and nuclear less competitive.