Energy Exchange

Grinch utilities and regulators spoil holidays by forcing customers to pay billions for Midwest coal plants

Thanks to Midwest utilities, regulators and a pair of unprofitable power plants, electricity customers in Ohio, Kentucky and Indiana will get a lump of coal this holiday season. The owners keep running these plants at a big loss – projected at over $5 billion – resulting in higher electricity prices and polluting power that isn’t needed.

A challenging setup

As part of the Ohio Valley Electric Corporation (OVEC), the two plants sit in southern Ohio and Indiana. Nearly 65 years old, these plants were built to power a plant in Piketon, Ohio that enriched uranium for nuclear weapons for the Cold War. The uranium facility ceased operations in 2001, but the power plants continue on.

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Also posted in General, Ohio / Comments are closed

Ohio continues move to smarter power system with multimillion-dollar clean-energy agreement

Over the past few years, Environmental Defense Fund (EDF) has actively opposed FirstEnergy in several cases where it sought bailouts for its uneconomic coal plants. We will continue to do so.

But if the utility giant wants to build a cleaner, more modern grid, we are eager to work together. Case in point: We are pleased to report that we reached an agreement on FirstEnergy’s plan to spend $516 million on grid modernization, bringing about lower bills, greater customer choice and less pollution.

Following AEP and Dayton Power & Light’s related agreements – both approved earlier this year – and in the midst of the Public Utilities Commission of Ohio’s (PUCO) innovative PowerForward initiative, it’s clear Ohio is on a path to a smarter, more sophisticated power system. Read More »

Also posted in Grid Modernization, Ohio, Voltage Optimization / Comments are closed

Dear FirstEnergy, America doesn’t need your coal plants

Why do grocers mark down the price of asparagus in the spring, or strawberries in the summer? Because they’re in season and stores have excess supply, and they need to increase demand by cutting prices. The lower prices are a sign, or “price signal,” of excess supply, and the grocers are following the economic law of supply and demand.

Electricity markets follow the law of supply and demand, too. Falling electricity prices are a price signal that we have more power plants than we need. The Federal Energy Regulatory Commission (FERC), which oversees our nation’s electric grid, reports on wholesale electricity prices, and their latest State of the Markets report is an eye-opener.

The report shows that we’re retiring old coal plants at a fast clip, but we’re adding new natural gas plants at an even faster clip – causing power prices to plummet. In PJM, the largest regional electricity market in the country, 1.9 GW of coal plants closed in 2017 as 2.8 GW of new natural gas plants were added. Read More »

Also posted in Electricity Pricing, Illinois, Ohio / Comments are closed

New study answers the question, ‘What is grid resilience?’

By Rama Zakaria, Michael Panfil

Whether or not our electric grid is “resilient,” and what if anything should be done to make the grid more resilient, has been a topic of intense scrutiny in the past year.

The stakes in this debate reached new dimensions last fall with a highly controversial proposal by Sec. Rick Perry and the U.S. Department of Energy (DOE), which claimed that the resilience of the electric grid is threatened by the premature retirement of uneconomic coal and nuclear plants. DOE’s flawed proposal – to bail out these plants through a profit-guarantee mechanism – was considered and unanimously rejected in January by the Federal Energy Regulatory Commission (FERC), the agency charged with overseeing our nation’s electric grid. DOE’s proposal, in short, was an incredibly bad idea.

When FERC dismissed DOE’s proposal it opened a new proceeding, asking a series of questions around the topic of grid resilience.

A Customer-focused Framework for Electric System Resilience, a new report authored by Alison Silverstein and Grid Strategies, aims to answer these questions. The report, commissioned by Environmental Defense Fund and Natural Resources Defense Council, recommends a customer-centric framework for evaluating electric system resilience and concludes that the most effective resilience solutions center upon the wires connecting the grid: distribution, and to a lesser extent transmission. By contrast, generation-related solutions – like keeping dirty coal and uneconomic nuclear plants online past their retirement dates – are the least effective for improving resilience. Read More »

Also posted in Clean Energy, Electricity Pricing, Grid Modernization, Market resilience, Utility Business Models / Comments are closed

Trump may greenlight an $8 billion attack on competitive energy markets

President Trump may soon grossly distort competitive markets for electricity. Last week, he announced his consideration of a request for “202(c),” by which he means an $8 billion proposal to bail out all merchant coal and nuclear plants in a region that spans across 13 Midwestern and Mid-Atlantic states.

The request comes from FirstEnergy, the Ohio-based utility giant that has sought billions of bailout dollars over the last decade to cover its bad business decisions. Although repeatedly rebuked by federal and state regulators, the company recently asked the U.S. Department of Energy (DOE) to bail out coal and nuclear units in the PJM-grid operator region by invoking section 202(c) of the Federal Power Act. Using this power would require the Department to find that additional compensation to these plants is necessary due to an “emergency” on the grid. The audacious proposal would bail out not only FirstEnergy’s facilities, but more than 80 coal and nuclear units throughout PJM, the largest grid-operator region in the U.S.

The plea aims to increase electricity bills by a staggering $8 billion annually. It also would insulate old, dirty power plants from competition – protecting them from markets where more affordable resources like solar, wind and natural gas are helping to drive down electricity bills for Americans. Read More »

Also posted in Clean Energy / Comments are closed

FirstEnergy shamelessly begs DOE to prop up uneconomic coal and nukes

By Michael Panfil, Dick Munson

Yesterday, FirstEnergy submitted an outrageous request to the U.S. Department of Energy (DOE).

The Ohio-based utility giant wants DOE to bail out not only its uneconomic coal and nuclear plants, but all ailing plants across the PJM Interconnection region – which includes 13 states and Washington D.C. FirstEnergy’s request, if granted, would fundamentally undermine important energy policy and represent a major step backwards for the American electric grid.

Federal regulators and many, many experts agree there is no imminent threat to the electric grid’s resilience. Yet FirstEnergy is attempting to mislead the government and American public by arguing its outdated plants are needed to keep the lights on.

This is far from the first time the company has requested a bailout, but this latest effort is its most shameless yet. By arguing that the federal government got it wrong earlier this year – when it declined to provide profit guarantees for the company’s expensive coal and nuclear plants – FirstEnergy is attacking the agency that oversees the interstate electric grid, ignoring evidence, making an illegal recommendation, and asking the American public to foot the bill for a multibillion-dollar-a-year bailout. Read More »

Also posted in Washington, DC / Comments are closed