The Federal Energy Regulatory Commission (FERC) will continue to consider the country as a whole in making decisions to improve resiliency and reliability in the power sector. That's according to FERC Commissioners Neil Chatterjee and Cheryl A. LaFleur who underlined their careful consideration and eventual rejection of Energy Secretary Rick Perry’s proposed Grid Resiliency Pricing Rule in a question and answer session today, sponsored by the Bipartisan Policy Center.
“I think that we looked at the facts, the evidence in the record,” LaFleur said. “We didn’t judge it by who proposed it.”
This proposal, drafted by the Department of Energy, called for an expedited rulemaking to support generators that provide specific reliability and resiliency attributes, like those that rely on coal.
The Notice of Proposed Rulemaking (NOPR) garnered criticism from various energy sector stakeholders for propping up the coal and nuclear industries. Chatterjee said he is rooting for the success of communities dependent on the coal industry, but it is not FERC’s role to further such economies. He also indicated that the nation’s energy portfolio needs contributions from nuclear resources. However, Chatterjee made it clear that the commission intends to treat all fuels equally, saying that the commission made their decision “in a fuel neutral way.”
Chatterjee wrote in his statement regarding the NOPR decision that the market should be key in setting rates. “The Commission previously has stressed its preference for market-based mechanisms as a means to ensure just and reasonable rates in jurisdictional organized markets. I share this preference for market-based solutions and would have urged RTOs/ISOs to identify market mechanisms to address these concerns.”
LaFleur also advocated for a market-based pricing system, stating that the commission’s primary duty is to keep the lights on at a price Americans can afford.
“I am a strong supporter of competitive markets, which benefit customers by reducing costs, improving efficiency and innovation, and strengthening reliability by deploying resources over a broader footprint,” LaFleur wrote in her NOPR decision statement.
The commission delivered a unanimous decision rejecting NOPR on Jan. 8, after an extension was granted from the original Dec. 11 due date. Both commissioners agreed that the extension was necessary for FERC’s careful consideration of the proposed rule. FERC will continue to assess ways to improve the power grid’s reliability and resiliency.
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