The Department of Energy (DOE)-generated notice of proposed rulemaking at the Federal Energy Regulatory Commission (FERC), aimed at rescuing coal and nuclear power generation from the vagaries of competitive markets by raising the idea of paying out-of-market prices for “resilient” generating technologies, rests on the idea of rewarding power plants that have a 90-day supply of fuel on site. The idea is that these plants – coal and nuclear as DOE framed it – are available when other generating technologies – specifically natural gas and renewables – are somehow knocked out during a blackout or other major grid perturbation.
It’s not only a bogus concept from the beginning – blackouts in the U.S. have overwhelmingly been a result of a grid collapse, not generating plant failures – but it ignores a number of other realities about power generation.
Another fallacy in the DOE plan is that it ignores important generating technologies that are at least as resilient as nukes and coal, arguably more so.
Then there is geothermal, where the fuel supply can be measured in geological time. In its comments, the Geothermal Energy Association (GEA) noted that its resources are “not currently deployed in markets within the scope of the Department of Energy’s proposed rule.” But that could change, as western U.S. energy markets are moving toward a wider spread of competitive bidding for supply. The spread of the California ISO’s energy imbalance market is an example.
From the Global Geothermal News archives:
- Friday, September 29, 2017 - USA: New FERC Rule Could Boost Baseload Electricity Generation
- Tuesday, September 12, 2017 - USA: FERC Exploring Enhanced Compensation for Generators that Provide "Essential Reliability Services"