FERC Conferences to Address Impact of EPA’s Clean Power Plan on Electricity Reliability and Markets

Further highlighting the breadth of potential impacts of EPA’s proposed Clean Power Plan on our nation’s system of electricity generation and the difficult issues posed by the relation of EPA’s proposal to state and regional energy regulatory authorities, FERC has planned a focused dialogue around these issues.

Some members of Congress and others have raised concerns with the EPA’s proposed rule, which would set carbon emission limits for existing electricity generating units, regarding its potential  impact on the reliability of the grid.  Utility decisions to close coal-fired generators in response to the proposal, and potential insufficient pipeline infrastructure in some regions to deliver natural gas to new gas-fired generators, have caused some to say the rule may result in electricity shortages.[1]

In response to these concerns, FERC will hold a series of technical conferences to discuss the implications of state, regional and/or federal plans for compliance with EPA’s proposed rule, especially the impact on electric reliability, wholesale electric markets and operations, and energy infrastructure.  The conferences will also address how the proposed rule may drive the need for additional infrastructure, especially new electric transmission and natural gas pipeline facilities, and whether there are regulatory barriers that need to be addressed.

The first conference, to be held on February 19, 2015, at FERC headquarters, will be Commissioner-led and address a national overview of issues.  According to the recently-released agenda, this conference will address:

• Electric reliability considerations, including how state, regional, and federal compliance plans could affect grid operations, and how reliability planning and compliance planning can be coordinated to address potential issues.
• Identifying and addressing infrastructure needs, including coordinating reliability and infrastructure planning and siting with environmental compliance efforts.
• Potential implications for FERC-jurisdictional markets and opportunities to coordinate compliance approaches with those markets to meet the proposed rule’s requirements.

FERC will also hold three staff-led regional conferences to address the proposed rule’s potential impacts in each region on reliability, operations, generator dispatch and infrastructure.  The regional conferences are as follows:

• February 25, 2015: Denver (Western region)
• March 11, 2015: Washington, DC (Eastern region)
• March 31, 2015: St. Louis (Central region)

FERC does not have a definitive role in EPA’s Clean Power Plan proposal and FERC holding technical conferences with respect to another agency’s rulemaking process is highly unusual.  Accordingly, what, if any, action FERC may take after the conferences is unclear.