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PJM official tells lawmakers FERC should act now on resilience

The U.S. Federal Energy Regulatory Commission should quickly offer some direction on the issue of resilience, including fuel security and system restoration after a blackout, PJM Interconnection President Andy Ott told lawmakers Oct. 11.

"Policy guidance from the regulator is really what we need to get started," Ott said. "We have been talking a little bit too long, we need some action," he said at a hearing of the U.S. Senate Committee on Energy and Natural Resources.

FERC in January launched a proceeding (FERC docket AD18-7) on grid resilience after nixing a U.S. Department of Energy proposal to compensate generators that maintain 90-day on-site fuel supplies. But FERC has not acted on the issue since then, Ott noted. "Frankly, what we really need is leadership," he said.

The hearing focused on blackstart, which is the process for returning energy to the power grid following a systemwide blackout. But the hearing also touched on fuel security and resilience, two issues that came up in a May memo that revealed the DOE was considering using emergency authorities to stave off coal and nuclear retirements.

"To our friends at the White House and DOE who are continually arguing only a coal-based system is secure, I would offer two facts," Committee Ranking Member Maria Cantwell of Washington said. "One: without blackstart capability, onsite fuel won't matter when the system is down. And two: clean energy resources can provide resilience, including blackstart capability," she said, citing hydroelectric blackstart facilities in her state.

Fuel security often is discussed in the context of the broader power system. But it also can be a problem for blackstart resources, the subset of small power plants that can be called on to restart the grid.

A gas-fired blackstart resource could be vulnerable to a single point of failure if it relies only on gas for fuel, Ott explained. But that gas plant could be more dependable as a blackstart resource if it keeps backup liquid fuel, such as oil, onsite, he said.

The majority of blackstart units are gas turbines, diesel generators and pumped and traditional hydroelectric facilities, David Ortiz, the acting director of FERC's Office of Electric Reliability, said, referencing a 2018 study by FERC and the North American Electric Reliability Corp. While the study recommended that utilities assess whether they rely on a single fuel for blackstart, it also found that the utilities that participated in the study had the means to mitigate this risk, Ortiz said in response to a question from Committee Chairman Lisa Murkowski of Alaska.

PJM has some vulnerability to the single-fuel issue, but it is not a widespread problem among the grid operator's 8,000 MW of blackstart resources, Ott said. But noting that being fuel diverse increases a resource's expenses, he said, "My opinion is we haven't done enough to make sure those resources are properly compensated."

Ott said PJM is talking with stakeholders about changing the grid operator's blackstart contract to include a dual-fuel requirement along with a corresponding increase in compensation for that service. That change would need to be approved by FERC, he said.

Meanwhile, Joy Ditto, president of the Utilities Technology Council, raised concern that a pending Federal Communications Commission policy would make using the radio frequencies utilities need to communicate after an outage more difficult. She said FERC and the FCC should hold regular meetings to discuss the interdependence between the energy and communications industries.

Kate Winston is a reporter for S&P Global Platts, which, like S&P Global Market Intelligence, is owned by S&P Global Inc.