Public comments made last week by Federal Energy Regulatory Commission Chief of Staff Anthony Pugliese before the American Nuclear Society indicate that the agency is working with other federal government officials to identify power plants that are “absolutely critical” to the grid, E&E News reported.
As we reported last month, on June 20, the Council on Environmental Quality (CEQ) initiated the rulemaking process to revise its National Environmental Policy Act (NEPA)–implementing regulations by publishing an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register. The ANPR seeks public comments on “potential revisions to update the regulations and ensure a more efficient, timely, and effective NEPA process consistent with the national environmental policy stated in NEPA.” On July 11, the CEQ announced that it is extending the comment period, which was scheduled to close on July 20, for 31 days until August 20, 2018, in response to public requests for a time extension. See 83 Fed. Reg. 32,071 (July 11, 2018). The Federal Register notices also provide instructions for filing comments on the ANPR.
In a June 26 letter, a broad coalition of 77 former government officials, lawmakers, and industry leaders urged US Department of Energy (DOE) Secretary Rick Perry to take “concrete steps” to prevent the premature shutdown of any additional nuclear power plants.
The letter commends Secretary Perry’s support of the nuclear industry to date but asks him to specifically promote the national security significance of nuclear energy. In doing so, the letter underscores the key role that nuclear energy plays in national security, particularly as an essential component of electric grid resilience and the largest source of emission-free generation.
The letter acknowledges that discussions of the general importance of nuclear energy are underway at the Federal Energy Regulatory Commission as well as at the grid operator and state regulator levels, but asserts that only DOE has the power to integrate nuclear power into the broader national security imperatives. The letter notes that such an integration will take time to consider, but asks Secretary Perry to ensure that no more nuclear power plants are closed in the meantime.
This letter appears to support President Donald Trump’s June 1 request for DOE to take measures to prevent further closures of nuclear power plants due to a national security interest in securing the national power grid's resilience.
We reported last month that the Council on Environmental Quality (CEQ), the US federal agency responsible for coordinating and overseeing federal agency implementation of the National Environmental Policy Act (NEPA), had signaled its intention to update the CEQ’s longstanding NEPA-implementing regulations (40 CFR Parts 1500-1508). On June 20, the CEQ initiated the rulemaking process by publishing an Advance Notice of Proposed Rulemaking (ANPR) in the Federal Register (83 Fed. Reg. 28,591). The ANPR seeks public comments “on potential revisions to update the regulations and ensure a more efficient, timely, and effective NEPA process consistent with the national environmental policy stated in NEPA.” The deadline for comments is July 20, 2018.
President Donald Trump directed Energy Secretary Rick Perry late last week to “prepare immediate steps to stop the loss” of “fuel-secure power facilities” arguing that a decline in coal and nuclear generation is jeopardizing the nation’s security. The federal government has not yet disclosed what those steps might be or which generation facilities are at issue. Nonetheless, press reports from CNN and Bloomberg, among others, suggest that the US Department of Energy (DOE) is considering a directive requiring Independent System Operators and Regional Transmission Operators (ISOs/RTOs) to purchase energy from designated “fuel-secure” plants for a period of up to, and possibly more than, 24 months to prevent any near-term decommissioning.
US Energy Secretary Rick Perry directed the Federal Energy Regulatory Commission (FERC) in late September 2017 to undertake a rulemaking that would have enabled generation assets with secure on-site fuel supply (e.g., nuclear and coal plants) in organized markets to receive payments for reliability and resiliency. On January 8, FERC refused to accept that proposal, terminating the proposed resiliency compensation rule. Although FERC requested further comment and input on the importance of “resiliency” in organized markets, it is unlikely that it will act on this issue in the near term.
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The US Department of Energy’s Advanced Research Projects Agency-Energy (ARPA-E) has published a new funding opportunity for up to $20 million as part of its Modeling Enhanced Innovations Trailblazing Nuclear Energy Reinvigoration (MEITNER) program. The objective of the funding is to foster development of new, innovative, and enabling technologies for existing advanced reactor designs in an effort to establish the basis for a modern, domestic supply chain supporting nuclear technology. The funding opportunity encourages collaboration across disciplines and the formation of diverse and experienced project teams to facilitate scientific and technological discoveries. The Concept Paper submission deadline is December 4, 2017, at 5:00 pm ET. Further information can be found here.
Invoking rarely used statutory authority, on September 29, Secretary of Energy Rick Perry directed the Federal Energy Regulatory Commission to undertake a rulemaking to enable generation assets in RTOs and ISOs to receive payments for reliability and resiliency benefits that the DOE views as uncompensated under current market rules.
If adopted, the proposed rules could provide significant economic support to coal and nuclear generation in organized markets.
On August 23, 2017, the US Department of Energy issued the “Staff Report to the Secretary on Electricity Markets and Reliability” (Staff Report). The Staff Report was commissioned by the Secretary of Energy to provide an assessment of the reliability and resilience of the US electrical grid. The Staff Report’s general findings are that the wave of retirements of baseload generating resources, like nuclear and coal generating plants, is being driven mainly by economic forces, particularly increased price competition from natural gas power plants and the increased penetration of renewable resources. However, a closer reading of the Staff Report suggests that other modifications to electricity market designs and the regulatory regime surrounding power generation may be necessary to stanch the retirements of coal and nuclear power plants.
As noted by Secretary of Energy Rick Perry in his cover note to the Staff Report, recent “extraordinary technological and resource changes” in electricity markets are “challenging the regulatory paradigm that has guided the industry’s growth for decades.” Secretary Perry concludes:
On May 23, the Federal Energy Regulatory Commission (FERC) issued a notice inviting comments on the interplay between state policy goals and organized wholesale electricity markets. The referenced state policy goals involve state support for zero-carbon-emitting power plants, including nuclear power plants, generally in the form of tax credits.
FERC’s recent actions are part of a larger policy discussion in which electricity market design issues remain controversial, a discussion that has been driven in part by increased state support for maintaining baseload generation, including nuclear, as the integration of renewables and other technologies continues. New York and Illinois, for example, have created tax incentives to support nuclear reactors in their states, but both programs are being challenged in court by other generators. Other states, including Connecticut, New Jersey, Pennsylvania, and Ohio, are reportedly considering similar support.
Resolution of these issues will be critical for nuclear merchant generators. For more information, as well as information on deadlines for filing comments, continue reading the LawFlash.