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Lawmakers question how retiring US coal-fired power plants could affect winter grid challenges

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Lawmakers question how retiring US coal-fired power plants could affect winter grid challenges

Highlights

US House of Representatives Republicans are concerned about how the retirement of a significant number of coal-fired power plants could affect the transmission grid in coming winters and are seeking answers from four grid operators on how those retirements will be handled, letters show.

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Citing the spikes in electricity prices, forced outages and other events of this past winter, top Republicans on the House Energy and Commerce Committee, including its chairman, Fred Upton, are concerned that "such outages and price increases could be further exacerbated in the future" as coal plants used to respond to acute needs this winter shut, they said.

The lawmakers sent nearly identical letters on Wednesday to PJM Interconnection, New York Independent System Operator, Midcontinent Independent System Operator and ISO New England seeking answers on how their grids would have fared had the plants slated for retirement been unavailable.


The lawmakers specifically sought "information relating to affordability and reliability concerns going forward, given that a large number of coal-fired units reportedly relied upon to meet the surge in demand this past winter are scheduled to retire over the next one to two years," which they attributed to Environmental Protection Agency rules for the power sector.

In particular, the lawmakers cited Energy Information Administration expectations that 60 GW of coal-fired capacity could be retired by 2020, with a significant swath of that capacity dropping off the grid in line with the April 2016 effective date of EPA's Mercury and Air Toxics Standards.

Upton and other senior committee members have long expressed concerns that the rule could increase energy prices and harm reliability, although EPA officials and others have argued that the rule will provide significant health benefits.

Defenders of the rule have also argued that a broader range of factors are driving older coal-fired plants from the grid, notably low gas prices.

In the letters, the lawmakers asked how many of the plants slated for retirement ran during the historic winter, and whether the grid operators have plans to replace that capacity.

If the new generation is slated to be natural gas-fired, the lawmakers asked whether gas deliverability is "an issue of concern" for the particular region, and whether there is "natural gas transportation capability" to serve the needs of the new plants.

And in noting that the extended bouts of cold weather "significantly affected" electricity prices and generation in many regions of the US this winter, they asked whether the grid operators had sufficient operating reserves, unplanned losses of load or relied upon imports from other systems. They also asked how renewables, distributed generation and demand response fared, and whether any outages or curtailments were due to a lack of fuel.

The US Federal Energy Regulatory Commission is slated next week to host a technical conference examining how the markets fared this winter. Commissioner Philip Moeller on Thursday announced he was seeking information on how those power plants that ran this winter but are slated to retire will be replaced.

"With only a few days before the [technical] conference, I do not expect that commenters will have sufficient time to answer this question in a complete and quantitative manner at the technical conference," Moeller said.

But in noting that public comments on the matter are open until mid-May, he said: "I expect that this question can be answered fully, and on a plant-by-plant basis, by that time."

--Bobby McMahon, bobby.mcmahon@platts.com
--Edited by Keiron Greenhalgh, keiron.greenhalgh@platts.com