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Glick questions DOE national security resilience rationale

Citing pipe security, Glick says resilience fix should fit problem

Washington — A US Federal Energy Regulatory Commission member Tuesday questioned the motivation behind the Department of Energy's efforts to prop up coal and nuclear plants and argued that power markets should account for government energy subsidies without getting bogged down in the details.

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"I think we have to figure out a way to accommodate these policies and realize that you are not going to have perfectly competitive markets," Richard Glick said at an Energy Bar Association forum in Washington. "But sufficiently competitive markets I think is what our goal should be," he added.

Glick also expressed support for state climate policies in light of inaction at the federal level. "If you believe, like I do, that greenhouse gas emissions are a significant issue, and that essentially it is an externality associated with generation ... you don't want to prevent states from pursuing policies that they think are appropriate to address that very real externality."

While Glick did not mention any specific proceedings, FERC has ordered PJM Interconnection to revise its capacity market rules to address state-subsidized energy resources.

NATIONAL SECURITY

On the issue of resilience, Glick said that DOE's leaked plan to use emergency authorities to address baseload coal and nuclear retirements seems to be an effort to save an industry from going under rather than an effort to address national security.

"There are times when national security is an issue, and certainly if the Department of Defense tells us it's a problem, then we should focus on it," he said. "But the Department of Energy talking about the energy grid, it seems to be something more going on there than just the idea of national security."

FERC in January launched a proceeding (AD18-7) on grid resilience after rejecting a DOE proposal to compensate generators that maintain 90-day on-site fuel supplies.

Glick said if action is needed on resilience, policymakers should ensure the solution fits the problem.

PIPELINE CYBERSECURITY

For instance, if people are concerned that gas pipelines supplying power plants are vulnerable to cyber or physical attacks, the government should figure out how to protect the cybersecurity of pipelines, he said. "I think we should try to figure that out and not try to figure some other solution that seems to be aimed elsewhere."

Glick noted that possible resilience issues are likely be at the transmission and distribution level and not necessarily at the generation level.

FERC does need to take action to deal with changes in the industry, Glick said. For instance, the commission should consider whether resources are economically dispatched, which grid services should be incentivized, and how to pay for the services that are needed, he said. "Some baseload generation is not economic anymore but it is not really providing the services we need anyway," Glick said, citing the need for flexible services.

Other FERC efforts on state-federal issues include how to allow distributed energy resources to participate in wholesale markets and whether to revise policies under the Public Utility Regulatory Policies Act, two initiatives that Commissioner Cheryl LaFleur also touted in a Monday speech on microgrids.

FERC INDEPENDENCE

Glick also referred to comments by FERC Chief of Staff Anthony Pugliese that indicated that FERC was working with the Trump administration on its resilience efforts.

Recent comments by the chief of staff were "ill-advised," Glick said. "We don't need to be doing the bidding of the administration," he said. "I think we really are independent and we really need to retain that image."

-- Kate Winston, kate.winston@spglobal.com

-- Edited by Richard Rubin, newsdesk@spglobal.com