Glick raises bailout concerns over resilience, fuel security dockets
Federal Energy Regulatory Commissioner Richard Glick raised concerns Tuesday about pending discussions on grid resilience and fuel security, telling reporters the issues could be used to prop up uneconomic power plants targeted for a bailout by the White House.
"I am concerned that people may try to use the fuel security debate to achieve those goals," Glick said, adding that regulators should be "dubious" when "people use the term 'fuel security' in the same sentence as 'resilience.'"
Glick's statement came less than two days before the release of a major fuel security report from PJM, the grid operator for the largest U.S. electricity market. Some market participants are concerned the report may call for enhanced payments to coal and nuclear plants with little benefit for the grid.
Glick's comments at an Energy Bar Association (EBA) meeting Tuesday illustrate how concern over a bailout for retiring coal and nuclear plants is shifting back to FERC from the White House.
Early this year, FERC rejected a cost recovery proposal for the plants floated by the Department of Energy, prompting President Trump to order DOE to find another way to save the generators.
One is a docket on grid resilience — the ability to bounce back from outages — opened by FERC when it rejected the DOE's original bailout plan.
The other is a proceeding on fuel security in ISO-New England, where the grid operator wants to ensure generators have adequate fuel supplies when natural gas is diverted for home heating in winter. PJM could soon propose fuel security reforms at FERC as well, if its Nov. 1 report finds the grid is over-reliant on gas.
On both issues, generators with the ability to store fuel onsite argue they should receive higher market payments — the same rationale behind the DOE's rejected bailout plant.
The argument makes Glick, a Democrat nominated by Trump last year, skeptical.
"We'll have to see how the PJM report comes out. In New England there's an issue that needs to be addressed," he said after speaking at EBA's Mid-Year Energy Forum. "Whether some of the solutions proposed are the right solutions I don't want to talk about because they're ongoing proceedings, but at the very least I think we need to be dubious when we hear people use the term 'fuel security' in the same sentence as 'resilience.'"
Instead of focusing on onsite fuel supplies, Glick said the resilience proceeding should seek to identify issues with the grid's ability to recover from outages and base solutions on those issues.
"I haven't seen anything in the record to suggest there's a problem," he told the EBA crowd, but if there is one, it likely doesn't have to do with power plant fuel supplies.
"The [onsite fuel] solution doesn't necessarily match the problem," he said. "For instance, a lot of people argue that natural gas pipelines are susceptible to cyberattacks … Okay, so let's figure out how to solve the cybersecurity problem."
If resilience issues are identified, Glick said they are more likely to be fixed with action to strengthen the nation's power grid, rather than the plants that feed power into it.
"I think everyone also recognizes that if we do have issues ... they are mostly going to be on the transmission and distribution level and not necessarily a generation level," Glick told the crowd. "We've got to focus more on transmission and distribution if we're going to address these issues."
During his address, Glick also touched on issues of FERC's independence, saying recent political comments from Chief of Staff Anthony Pugliese were "ill-advised."
"To go on various radio shows and make attacks against the governor of New York and to take certain positions that are more in line with the administration than the commission is not a wise strategy," Glick said. "We've had conversations with the chief of staff and I'm sure others have as well and I think it's very important that ... we are not trying to do the business of the Trump administration or trying to do the business of [House Minority] Leader [Nancy] Pelosi."
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