FERC seeks fast track on DOE baseload compensation proposal
- The Federal Energy Regulatory Commission set tight deadlines for industry to file comments on a controversial market reform proposal from the Department of Energy, saying on Monday that initial comments are due on Oct. 23 and reply comments on Nov. 7.
- FERC's move came as a group of 11 energy trade associations filed a motion with the Federal Energy Regulatory Commission on Monday asking it to extend its consideration of major electricity market reforms beyond the 60-day timeframe requested by the Department of Energy. FERC could still grant extensions on its comment timetable.
- The group, including representatives from the solar, natural gas, wind, co-op and municipal utility industries, wrote the DOE failed to provide a reason for such a short consideration period in its rulemaking filing on Friday. "No emergency exists to justify such an action," they wrote.
Days after the Department of Energy proposed the most significant reforms to wholesale power markets in a generation, energy industry groups are taking sides.
On Sept. 29, DOE filed a Notice of Proposed Rulemaking at FERC asking the commission to provide cost recovery for power plants that keep a 90-day supply of fuel onsite. The proposal sparked outcry among other power interests who worry it could unravel competitive electricity markets.
Coal and nuclear interests moved quickly to praise the proposed rule. Exelon, the nation's largest nuclear generator, said it was "pleased" DOE moved to "ensure that attributes of nuclear generation are fully and appropriately valued."
But a larger contingent of power sector interests expressed dismay at the proposal. In a filing at FERC, a broad array of power sector interests argued that the DOE proposal offered no justification for its directive that FERC conclude its rulemaking on market reforms within 60 days.
"To the extent the [NOPR] implies that an emergency exists to justify the proposed interim final rule (although it provides no justification for this action whatsoever), publicly available information from the Department of Energy (“DOE”) and North American Electric Reliability Corporation (“NERC”), as well as other experts, all demonstrate that no emergency exists that would justify such an action," they wrote.
That timeframe, the groups pointed out, would leave only 15 days for commissioners to consider the final rule after a 45-day comment period. The trade associations requested 90 days for initial comments on any proposed rule, as well as time for reply comments and the convening of a technical conference on the proposal.
"These reasonable steps would allow for meaningful public input from all stakeholders, including from energy market participants, grid operators and regulators and the power-consuming public," the groups wrote.
The association letter was signed by 11 groups: Advanced Energy Economy; the American Council On Renewable Energy; the American Petroleum Institute; the American Public Power Association; the American Wind Energy Association; the Electricity Consumers Resource Council; the Electric Power Supply Association; the Interstate Natural Gas Association of America; the National Rural Electric Cooperative Association; the Natural Gas Supply Association; and the Solar Energy Industries Association.
The Edison Electric Institute, the trade group for investor-owned utilities, did not sign onto the trade association letter. In a statement, EEI vice president of energy supply Richard McMahon said the NOPR shows DOE recognizes that "a balanced energy mix that includes 24/7 energy sources is vital to sustaining a secure, reliable, and resilient energy grid."
"New market rules should recognize the role that all generation sources play in maintaining the reliability and resiliency of the energy grid," he said.
FERC's deadlines released Monday could indicate that the commission intends to fast-track the proposal, but energy lawyers and former FERC commissioners told Utility Dive last week FERC is likely to extend its timeframe. The NOPR is likely too vague to form the basis of a final rule, they said, and FERC may have to start over with the proposal as "a prompt for comments" that would form the basis of final policy.
This post has been updated to include comments from the Edison Electric Institute.
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