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Murray Energy, US Chamber claim no role in development of DOE grid proposal

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Murray Energy, US Chamber claim no role in development of DOE grid proposal

Coal miner Murray Energy Corp. and the U.S. Chamber of Commerce are distancing themselves from the U.S. Department of Energy's proposed grid reliability rule in newly released comments filed with the Federal Energy Regulatory Commission.

The DOE's notice of proposed rulemaking, or NOPR, issued in late September, asked FERC to implement a rule to support fuel-secure generators and prevent premature retirement of those units to ensure grid reliability. The proposal was widely panned by industry, environmental groups and many others as a bailout for coal and nuclear generators.

A handful of environmental groups on Dec. 20 urged FERC to reject the proposed rule in light of a previously undisclosed meeting between Murray Energy CEO Robert Murray and Energy Secretary Rick Perry. During that meeting, Murray reportedly handed Perry a document titled "Action Plan For Reliable And Low-Cost Electricity In America And To Assist In The Survival Of Our Country's Coal Industry." The groups, including the Sierra Club, Natural Resources Defense Council and others, suggest that language from that document closely resembles what was ultimately included in DOE's proposed reliability plan.

In a strongly worded response, Murray Energy said the groups' request of FERC is "composed solely of lies, mistruths, and reckless and inaccurate speculation."

Murray Energy said it has "never proffered a proposed grid resiliency rule to Secretary Perry or DOE," and until the formal comment period opened up for the proposal through FERC, the company had never suggested that the grid resiliency rule be adopted. In a related news release, the company said Murray only proposed a study of the reliability of the U.S. power grid and the cost of electricity during his meeting with Perry. The DOE ultimately did conduct a reliability study, which was issued in August.

"Because the advocacy groups cannot prevail on the merits in their opposition to the grid resiliency rule, they resort to underhanded conspiracy theory and insinuations," Murray Energy wrote. "The supplemental comment attempts to cause DOE to shy away from adoption of the grid resiliency rule by suggesting in a public forum, without a scintilla of truth, that DOE lacks capacity for independent thought and that the [rule] is the product of some unethical, back-room deal."

Murray Energy also defended its right to meet with government officials to discuss matters that pertain to its business.

"Robert Murray has the absolute right to meet with DOE secretary and any representatives of DOE at any time they are willing to meet with him," the response reads. "Mr. Murray does not need the permission of the advocacy groups to meet with our elected representatives, nor does any other American citizen."

The U.S. Chamber, meanwhile, has faced criticism for a study commissioned by its Global Energy Institute that Perry cited as justification for the rule. The Chamber now says it was unaware the DOE would use its study, and the fact that it was released shortly before Perry announced the proposal was merely a coincidence.

The Chamber-backed study has become a lightning rod during the ensuing debate surrounding the NOPR. Conducted by IHS Markit, the study reasoned that the current U.S. generation mix lowers the cost of electricity production by about $114 billion per year and reduces the average retail price of electricity by 27% compared with a less diverse scenario.

"The connection of these two documents led many to conclude that their development was related," the Chamber explained to FERC. "To be clear, our sponsorship of the generation study was neither initiated, nor intended, to support the proposal in the DOE NOPR." The Chamber asserted that its study should not be considered support for the DOE NOPR, either.

The study was heavily criticized for its findings, including by one of the organizers of the DOE's grid reliability study. Energy consultant Alison Silverstein wrote in an opinion piece published by trade publication Utility Dive on Dec. 6 that the Chamber-commissioned study "has so many factual, logical and methodological flaws that it is wholly unsuitable to inform serious public policy." Nevertheless, proponents of the DOE's NOPR including Murray Energy and coal-heavy mid-Atlantic utility FirstEnergy Corp. also pointed to the study in comments filed with FERC to back swift and drastic action to protect the grid from further generation retirements. (FERC docket RM18-1)