Federal Energy Regulators Dive into Sister Agency’s Power Plan Rule

The Federal Energy Regulatory Commission Feb.19 publicly zeroed in on reliability concerns of the U.S Environmental Protection Agency’s Clean Power Plan.

EPA’s proposed regulation that is to be finalized in June seeks to cut emissions from coal and other fossil-fueled generation sources across the nation by 30 percent from 2005 levels by 2030. It gives the states flexibility in how to reach that target, including making way for regional emission reduction plans. Republican lawmakers and a number of states object to the plan because of concerns over impacts to the electric grid, including uncertainty over reliability and rates.

Commissioner Tony Clark called FERC’s first technical conference on the proposal the federal commission’s “first granular and technical analysis,” particularly in the area of voltage support. In addition, FERC is probing how the final plan impacts state, regional, bilateral and wholesale markets, he noted.

EPA authority is based in the federal Clean Air Act.

Janet McCabe, EPA assistant administrator for air and radiation, told the commission that her agency considers reliability critical. She added, “For the last 40 years in implementing the Clean Air Act, there has been no interference with electrical reliability.”

FERC was directed by federal lawmakers to hold technical conferences to ensure its transmission authority is used to help avoid impacts to the grid. Clark pointed out that includes avoiding the creation of a patchwork of state and regional plans that “tear apart at the seams.”

Allowing states flexibility in how to reach the rule’s emission reductions and giving them a 15-year planning horizon are expected to avoid harm to state, regional and national grids, McCabe stressed.

Power plants in the U.S. are the largest source of greenhouse gas, responsible for 40 percent of the nation’s carbon emissions. One of the gripes about the rule is that it won’t allow California and other states to get emission reduction credits for electric vehicle fleets.

McCabe noted that the rule sets emission performance standards for industrial sources of carbon pollution, not mobile individual sources. “There are limits on EPA’s strategies,” she said. “We need to be grounded solidly in rule 111D authority.”

Another fear is that states’ implementation of the EPA rule will open the door to third-party lawsuits. McCabe said that applying a portfolio approach—one based on generation sources—should help deter court challenges.

Craig Glazer, with the ISO/RTO Council, reiterated McCabe’s note to ensure that state plans are rooted in the federal plan. That way, he said, “It is harder for a judge to find a rule violation.”

EPA’s public comment period on the rule is officially closed, but the door is open for comments on the plan’s implementation pre- and post-finalization. That includes information and access to resources available to states to put their version of the plan into action.

In addition, federal energy regulators are planning to hold three more technical conferences on the clean power plan. That includes hearings on Feb. 25, March 11, and March 31 in Denver, Washington D.C., and St. Louis. —Elizabeth McCarthy