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Washington Week: Public power to rally Congress; House sets Puerto Rico update

With Congress back in session following the Presidents Day holiday break, public power advocates will meet with lawmakers to discuss a range of legislative priorities, including blocking the Trump administration's proposed sale of federally owned transmission assets.

The American Public Power Association, or APPA, will hold its annual legislative rally Feb. 26-28 in Washington, D.C. The group, whose members provide power to roughly one-in-seven U.S. electricity customers, will focus on infrastructure financing, grid security, wholesale power markets, distributed generation and environmental regulation.

APPA also will urge members of Congress to reject the White House's calls to privatize transmission assets owned by the Tennessee Valley Authority and three federal power marketing administrations, or PMAs — the Bonneville Power Administration, Southwestern Power Administration and Western Area Power Administration. The Trump administration made the proposal as part of its fiscal year 2019 budget request released Feb. 12.

The White House made a similar request in its fiscal year 2018 budget, which called for selling the three PMAs' transmission lines. But Congress, which would need to approve the sales, excluded the proposals from recent appropriations and spending bills, with lawmakers noting potentially higher costs for consumers if the assets were to be sold to private entities.

The concept did not sit well with some lawmakers this time around, either. U.S. Sen. Lamar Alexander, R-Tenn., called the proposal a "loony idea" that has "zero chance of becoming law."

Separately, the Trump administration proposed allowing the Bonneville Power Administration and other PMAs to increase their electric rates to the same level as those of for-profit utilities rather than charging cost-based rates. But a new report from the Northwest Power and Conservation Council estimated that Bonneville power prices would jump by 20% to 40% if the PMA followed through on Trump's proposal.

Puerto Rico status check

The U.S. House of Representatives' Committee on Energy and Commerce had been scheduled to hold a Feb. 28 subcommittee hearing on how Puerto Rico's electric grid is doing after Hurricanes Irma and Maria struck the U.S. territory in September 2017 but the hearing has been postponed.

Five months later, the Puerto Rico Electric Power Authority still has not restored power to all its customers, and policymakers are considering what legislative and financial remedies could help the cash-strapped island build a more resilient and modern grid.

Congress has voted several times to provide disaster assistance money to Puerto Rico. And on Feb. 23, President Donald Trump agreed to extend for 60 days the federal government's 100% cost-sharing on recovery agreed to in the wake of the hurricanes.

But the island's rebuilding needs are significant. Puerto Rico has requested $94.4 billion in federal disaster assistance relief, including $17.8 billion for utility infrastructure. Beyond restoring power, Puerto Rico wants to modernize its electric grid and make the system better able to withstand extreme weather.

Deadline nears in FERC resilience proceeding

An early March deadline is approaching for regional grid operators to share their resilience concerns with the Federal Energy Regulatory Commission. FERC launched the proceeding in early January after rejecting the U.S. Department of Energy's request that it adopt a grid resilience rule that would have mainly benefited coal-fired and nuclear plants.

Although coal and nuclear groups were disappointed with FERC's decision, they still are pressing the commission and regional grid operators to consider some type of market support for their industries, which have experienced an uptick in plant retirements recently largely due to increased competition from natural gas and renewable energy and slow demand growth.

"We think there's a market-based way to value fuel security, as well as maybe other attributes of the coal fleet," Paul Bailey, president and CEO of the American Coalition for Clean Coal Electricity, told S&P Global Market Intelligence in a Feb. 23 interview. "So we would like to see the wholesale markets develop ways to value those coal fleet attributes. You could say the same thing about nuclear."

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Congress
Feb. 27

The U.S. House Committee on Energy and Commerce's Energy Subcommittee will hold a hearing on the "State of the Nation's Energy Infrastructure."

Feb. 27

The House Natural Resources Committee's Energy and Mineral Resources Subcommittee will hold an oversight hearing on "Liquefied Natural Gas and U.S. Geopolitics."

Feb. 28

The U.S. Senate Energy and Natural Resources Committee's Subcommittee on Water and Power will hold a legislative hearing on several bills.

March 1

The Senate Energy and Natural Resources Committee will hold a hearing on cybersecurity for critical energy infrastructure.

Industry events
Feb. 26

The Center for Strategic and International Studies' Energy and National Security Program will host the U.S. launch of BP's energy outlook for 2018 at CSIS's headquarters in Washington, D.C.

Feb. 26

The Bipartisan Policy Center will hold a talk on nuclear energy exports at the center's Washington, D.C., office.

Feb. 26

The Center for Climate and Security and the Environmental and Energy Study Institute will host a climate and national security forum on Capitol Hill.

Feb. 26-28

The American Public Power Association will hold its annual legislative rally in Washington, D.C.

Feb. 27-March 1

The ERCOT Market Summit will take place in Austin, Texas.

Feb. 27

Gordon van Welie, president and CEO of ISO New England, will give an update on the state of New England's power grid.

Feb. 27

CSIS will hold a conference on the short-term outlook for U.S. tight oil production.

Feb. 27

ClearPath and Third Way will host an event on how the fiscal year 2019 budget process could affect federal clean energy spending.

March 1

Bracewell LLP will host an infrastructure symposium on Capitol Hill featuring the White House Council on Environmental Quality's Alex Herrgott and Interstate Natural Gas Association of America President and CEO Don Santa.

Notable stories from last week

Federal judge halts Trump administration move to abandon Obama-era methane rule

DOE official: Agency will not use emergency authority to save uneconomic plants

Energy, Interior secretaries tout Trump's 'world changing' energy tactics

DOE crafting energy resiliency planning, operating model

FERC accepts PJM proposal to limit virtual transaction bidding points