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Court’s Emissions Rule Decision Will Not Halt Public Power’s Shift Away From Fossil Fuels: Fitch

July 14, 2022

by Paul Ciampoli
APPA News Director
July 14, 2022

The recent U.S. Supreme Court ruling that limits the Environmental Protection Agency’s (EPA) authority to cap greenhouse gas emissions will not materially affect public power utilities’ credit quality or the move away from fossil fuels, Fitch Ratings said on July 8.

The Supreme Court on June 30 reversed a U.S. Court of Appeals for District of Columbia Circuit ruling striking down the Trump administration’s Affordable Clean Energy rule, which repealed the Obama-era Clean Power Plan and replaced it with the ACE rule, a more limited regulation of carbon dioxide emissions from existing power plants.

The ruling “is mildly favorable for those public power utilities that own and operate coal- and gas-fired units, as they will have more time to develop transition strategies and amortize investments in coal and gas plants,” the rating agency said. “However, any benefits should be short lived.”

Moreover, the decision “may slow decarbonization trajectory but will not reverse its course, as state and local government directives, investor preferences, and increased affordability continue to drive the transition toward renewable energy and lower carbon-emitting strategies,” Fitch said.

The rating agency said that decarbonization strategies have for the most part been driven by states that have set their own clean energy standards.

Fitch noted that the National Conference of State Legislatures reports that 23 states and territories adopted renewable energy standards or goals that apply to public power and/or cooperative utilities. “The transition could accelerate for these issuers if states with no standards or expired standards adopt new or expanded rules,” Fitch said.

In addition, Fitch said that carbon reduction strategies “will also continue to be driven by policies aimed at limiting investment in thermal coal and investors’ increasing concerns over the environmental effects of coal-related assets.”

It said that higher natural gas and market power prices “could also drive issuers toward lower carbon strategies as the comparative economics of renewable energy resources improves and access to these resources better positions public power systems to avoid or mute the effect of higher energy costs.”

Fitch’s forecast assumption for 2022 US natural gas prices is $6.25/thousand cubic feet (mcf), up from $3.25/mcf in December 2021. “While natural gas prices are expected to moderate toward $2.75/mcf over the longer term, sustained high prices could steer utilities to accelerate the addition of renewable resources, notwithstanding current inflationary pressures and supply chain challenges related to green energy.”

TVPPA Develops New Supply Chain Toolkit to Support Its Member Utilities

July 13, 2022

by Vanessa Nikolic
APPA News
July 13, 2022

The Tennessee Valley Public Power Association (TVPPA) developed a new supply chain toolkit to provide support to its member utilities across the Tennessee Valley. The toolkit includes talking points, social media posts, and sample letters that can be used by key accounts and communications teams.

The electric utility industry continues to experience a materials shortage. In an effort to seek a deeper understanding of challenges that Tennessee Valley utilities encounter, TVPPA took steps to develop a communications-focused supply chain toolkit for its members.

Last fall, TVPPA attended a regional meeting of utility executives where one of the roundtable discussions among its members focused on supply chain concerns. The idea of developing a toolkit emerged from a subsequent internal discussion about how TVPPA could proactively provide tools and services to address its members’ needs.  

In November 2021, the need for supply chain messaging continued to grow and TVPPA started gathering information and pooling resources in order to make a toolkit available before the holidays. 

TVPPA says its Communications Advisory Group (CAG) was a beneficial component during the toolkit development phase since the group helps the association keep up with the resources that its members need most. The group, which is reflective of TVPPA’s membership, is comprised of communicators and customer service representatives from member utilities of all sizes. TVPPA’s team works closely with CAG members to create and refine content.

Launched in December, TVPPA’s Supply Chain Communications Toolkit enables it members to effectively discuss supply chain disruptions with their key audiences, particularly as they relate to transformers and other materials critical to servicing the needs of consumers and communities. The toolkit can be customized according to each utility’s unique circumstances and includes messaging that can be used by key accounts and communications teams in written and verbal communications, ideas for how and where to share the messages, and sample letters to send to developers and partners.

The toolkit also includes materials that were shared by TVPPA members that had already begun addressing supply chain challenges in their communities.

TVPPA Vice President, Communications and Marketing Nathalie Strickland was involved in the development of the toolkit and has received positive feedback from members.

“It has been well received by our members from both large and small systems,” Strickland said. “They’ve appreciated the ability to see what other power companies are using to communicate effectively with their customers and business and community leaders. The easy-to-use format enables them to focus more of their energy on managing customer expectations and creatively solving materials shortage challenges.”

TVPPA says its team is open to expanding the kit to accommodate the growing needs of utilities who may request additional resources in the future. The toolkit is free of charge and is one of the many benefits that utilities can access on the members section of TVPPA’s website. 

“We have incredibly talented power company leaders in the Tennessee Valley who offer great thought leadership, and we know that when we harness their collective wisdom and maximize the capabilities of our staff to address their pain points, we support their businesses success regardless of what our ever-changing industry brings,” Strickland said. “That’s the approach we took with the Supply Chain Communications Toolkit, and we think that’s why it has been valuable to so many power companies in our region and now to others across the country.”

TVPPA will host its annual Valley Rally in Washington, D.C. on July 18-20 and will continue to raise awareness of supply chain issues during the event with members of the Valley Congressional delegation and discuss potential solutions that could provide short-term relief with an eye towards mitigating long-term consequences.

In addition to the supply chain toolkit, TVPPA plans to release three new toolkits this year focused on the value of locally-owned power, the power restoration process, and crisis communications.

APPA Supply Chain Efforts

The American Public Power Association (APPA) is taking a number of actions to address ongoing supply chain challenges.

Joy Ditto, President and CEO of APPA, recently noted that APPA has been working with the federal government “to partner with us on getting the manufacturers in a room to really suss out what this could look like and how we could get to a point where we reduce these lead times and, secondarily, really address the pricing issue.”

She made her comments during a virtual press briefing held by the U.S. Energy Association (USEA) related to supply chain issues and the electric utility industry.

A tiger team has been formed under the auspices of the Electricity Subsector Coordinating Council, led by the various electricity trades and select CEOs from the industry, including several from public power.

The objective is to enable the Department of Energy (DOE) “to talk to us and to hopefully bring the manufacturers in to address the issue for the medium term.” In the short term, the industry has been speaking across sectors about equipment sharing.

APPA recently rolled out an additional feature to its eReliability Tracker that is available to all public power utilities and allows for voluntary equipment sharing by matching systems with the same distribution voltages.

In a speech in June at APPA’s National Conference in Nashville, Tenn., Ditto urged member utilities to share their supply chain challenges with APPA so that the trade group can relay details on these challenges to federal partners and discuss how critical burdens on the sector can be alleviated.

In May, APPA convened a supply chain summit that included participation from public power utility officials who discussed their supply chain challenges and mitigation strategies.

APPA also recently finalized a new supply chain issue brief. APPA members can download the issue brief here.

Ariz. Public Power And Cooperative Groups Urge PG&E To Extend Nuclear Plant’s Operating Life

July 12, 2022

by Paul Ciampoli
APPA News Director
July 12, 2022

In a recent letter to the CEO of California investor-owned utility PG&E, groups representing public power utilities and electric cooperatives in Arizona made the case for extending the life of the California nuclear power plant Diablo Canyon Power Plant past its existing license.

“While we understand that the history of the plant is long and complicated, we hope that you will agree that the benefits of extending the operating license outweighs the cons,” wrote officials with the Irrigation & Electrical Districts’ Association of Arizona (IEDA), the Arizona Municipal Power Users’ Association (AMPUA) and the Grand Canyon State Electric Cooperative Association (GCSECA) in their June 27 letter to Patricia Poppe, CEO of PG&E.

“The development of carbon-free replacement power is not keeping pace with California’s decision to eliminate fossil fuel generation by 2045,” the letter said. With ongoing supply chain and solar tariff issues, most new plant construction has been pushed out at least two years, the letter said.  “If PG&E were to take a plant that provides roughly 9% of California’s energy offline in an environment of already limited capacity, rolling blackouts worse than those in 2020 are sure to follow.”

The letter was signed by Ed Gerak, executive director of IEDA, AMPUA’s Russell Smoldon, and Dave Lock, CEO of GCSECA.

In June 2016, PG&E said it planned to retire Diablo Canyon nuclear power plant in California under a joint proposal with labor and environmental groups. The California Public Utilities Commission in 2018 signed off on a request by PG&E that it be allowed to retire the Diablo Canyon nuclear plant by 2025. The two units at Diablo Canyon together produce approximately 2,300 net megawatts of power.

In their letter, Gerak, Smoldon, and Lock noted that in the Long-Term Reliability Assessment released in December 2021 and developed by the North American Electric Reliability Corporation, Diablo Canyon’s retirement was highlighted as further impacting the reserve margin, which it described as insufficient to manage region-wide heat waves like seen in 2020. “With the existing capacity constraints and the rapid increased cost for natural gas, companies are returning to coal for economic and reliability reasons.  Closing Diablo Canyon would exacerbate this issue in the future,” the letter said.  

Gerak, Smoldon, and Lock also noted that the Bipartisan Infrastructure Law has $6 billion in a Civil Nuclear Credit Program that could be used to help retrofit the plant and extend the license.

The U.S. Department of Energy (DOE) on June 30, 2022 announced an amendment to the Civil Nuclear Credit Program Guidance for the currently open award cycle. To incorporate these changes and give potential applicants the time they need to respond, DOE also extended the application period another 60 days to September 6, 2022. PG&E had requested an extension for the deadline.

In April, California Gov. Gavin Newsom told the Los Angeles Times editorial board that the state “would seek out a share of $6 billion in federal funds meant to rescue nuclear reactors facing closure,” the newspaper reported.

“With the ongoing drought, hydropower production has been severely impacted,” the letter from the IEDA, AMPUA and GCSECA officials said. “There is a real possibility of some plants losing power production completely.  Nuclear power is the only carbon-free base load generation in the West that we can still count on. We hope that includes Diablo Canyon in the future.”

OPPD Recommends Delaying Retirement, Conversion Of Units At Plant

July 12, 2022

by Paul Ciampoli
APPA News Director
July 12, 2022

Nebraska public power utility Omaha Public Power District (OPPD) in June made a recommendation at a OPPD Board of Directors meeting to delay the retirement of North Omaha Station (NOS) units 1-3 and fuel conversion of units 4 and 5 from low-sulfur coal to natural gas.

The delay is only until the utility’s new natural gas generation balancing stations are fully approved for grid interconnection service in accordance with federal law issued by the Federal Energy Regulatory Commission and administered by the Southwest Power Pool (SPP), OPPD noted.

Previously, OPPD’s Board of Directors approved these changes at NOS to occur by the end of 2023, when the new natural gas generation balancing stations – Standing Bear Lake (SBLS) and Turtle Creek (TCS) were planned to come online.

However, due to unforeseen delays with grid interconnection regulatory approvals for those projects, part of the utility’s Power with Purpose (PwP) initiative, OPPD recommended maintaining current generating operations at NOS until the new natural gas balancing stations are fully available, which is estimated by 2026.

PwP will bring additional generation totaling approximately 1,200 megawatts (MW) of natural gas and solar capability online.

OPPD said that the construction of SBLS and TCS is critical to ensuring continued system reliability and resiliency. Once these stations are online, OPPD will look to retire North Omaha Station units 1-3 and refuel units 4-5 from low-sulfur coal to natural gas.

In 2016, OPPD retired North Omaha units 1-3 from coal operations. Today, these units are available to run on natural gas, serving as peaking units during times of high demand for electricity.

SBLS and TCS are under construction now. However, in accordance with federal requirements, SPP must conduct a grid interconnection study before they can be connected to the grid.

“And with a large number of new generation projects requesting to come online in our region and every other region in the country, there is a major study backlog,” OPPD noted.

In addition, the two new natural gas generation projects have experienced some siting and grading delays, as well as supply chain issues. The new solar generation projects have also experienced challenges with siting of projects and supply chain challenges, including impacts from the federal focus on solar panel imports.

“This is one of those moments where we need to slow down our present path to achieve our future goals,” said President and CEO Javier Fernandez. “The extension of North Omaha Station’s current mission supports our commitment to reliability and resiliency, something we know our customers and communities are especially mindful of following the 2021 polar vortex event.”

OPPD said its leadership team continues to work diligently on finding solutions to the challenges facing not only the utility, but utilities across the region. Current delays will not impact OPPD’s commitment to achieving net zero carbon by 2050, the utility said.

The board of directors will vote on the recommendation during its next meeting, Aug. 18.

TVA Seeks Up To 5,000 Megawatts Of Carbon-Free Energy

July 12, 2022

by Paul Ciampoli
APPA News Director
July 12, 2022

The Tennessee Valley Authority (TVA) on July 12 issued a request for up to 5,000 megawatts of carbon-free energy that must be operational before 2029.

Any transaction resulting from the request for proposals (RFP) will be in the form of a Power Purchase Agreement (PPA).

TVA said that the procurement is one of the largest clean energy procurement requests in the nation.

TVA is interested in procuring carbon-free energy resources with commercial operation dates from 2023 through 2029 including: solar, wind (offshore or land based), hydro, geothermal, biomass, nuclear, green gas, battery energy storage systems (BESS) paired with the above resources, standalone BESS, “and hybrid combinations of the aforementioned resources,” the RFP said.

TVA said it reserves the right to vary from the above stated energy quantity target. The PPA will also require the transfer to TVA of all the applicable associated environmental attributes (renewable energy credits/certificates, etc.).

All resources must be located in the TVA service territory or delivered to TVA’s interface with neighboring transmission systems. If any proposal is delivered to the TVA interface, it must have all cost components included for an all-in energy price.

TVA noted that it is executing a defined strategy to reduce carbon from 2005 levels by 70% by 2030, 80% by 2035, and aspire to be net-zero by 2050.

To support its carbon-reduction efforts, the agency is exploring and accelerating carbon-free technologies and moving to bring an additional 10,000 MW of solar energy capacity online by 2035.

Proposals must be submitted by October 19, 2022, and TVA will announce selected projects in Spring 2023.

The RFP is available here.

DOE Opens Applications For $2.3 Billion Grid Modernization Formula Grant Program

July 11, 2022

by Peter Maloney
APPA News
July 11, 2022

The Department of Energy (DOE) last week opened the application process for a $2.3 billion grant program for states, Tribal nations, and territories designed to strengthen and modernize the power grid against wildfires, extreme weather, and other natural disasters exacerbated by the climate crisis.

The so-called formula grant program will distribute up to $2.3 billion over five years and will provide grants based on a formula that includes, among other things, population size, land area, probability and severity of disruptive events, and a locality’s historical expenditures on mitigation efforts.

Grant priority will be given to “projects that generate the greatest community benefit providing clean, affordable, and reliable energy to everyone, everywhere, anytime,” the DOE said.

Grid resilience activities that qualify under the program include:

The DOE said it would give priority to projects that aim to generate the greatest community benefit in reducing the likelihood and consequences of blackouts and power shutdowns because of extreme weather or other disruptive events like cyberattacks. Projects should also seek to create “good-paying union jobs with a focus on high labor standards and the free and fair chance for workers to join a union,” the DOE said.

The DOE also noted that applicants will be asked to describe the concrete outcomes they intend to seek, and commit to specific progress metrics, such as reducing or shortening outages from severe events or reducing risks to health and safety from such outages.

The application deadline is Sept. 30.

The Bipartisan Infrastructure Law established the Preventing Outages and Enhancing the Resilience of the Electric Grid program, which is administered through DOE’s Building a Better Grid Initiative. The program aims to move the nation closer to the Biden Administration’s goal of a national grid run on 100 percent clean electricity by 2035.

Newton, N.C., Electric Department Recognized For Safety Efforts

July 11, 2022

by Paul Ciampoli
APPA News Director
July 11, 2022

The Newton Electric Department in Newton, N.C., was recently honored with the North Carolina Association of Municipal Electric Systems Safety Award for 2021.

The award recognizes the staff of the Newton Electric Department for providing affordable, reliable electric service to Newton’s nearly 5,000 electric customers without sustaining any lost-time injuries in 2021. The award was presented at the association’s recent annual meeting.

Newton Electric Division Manager Doug Wesson has developed his team’s safety programs over the course of his career, and Electric Division Supervisor Jeff Cochrane has assumed a growing role in continuous improvement of safety programs in recent years.

The City of Newton is a public power community with an electric system that dates to 1896 and today serves 4,710 customers.

The Newton Electric Department staff includes one manager, one supervisor, six lineman, two tree trimmers, one generator technician, and one meter technician. The team has more than 100 years of combined experience in electric distribution.

Newton Electric Department staff were recognized for their accomplishments at the Newton City Council meeting on June 21.

Grid Operators Respond To High Temperatures, Soaring Power Demand

July 11, 2022

by Paul Ciampoli
APPA News Director
July 11, 2022

The Electric Reliability Council of Texas (ERCOT) and the PJM Interconnection took steps to respond to hot weather this week and the expected increases in power demand.

ERCOT on July 10 asked Texas residents and businesses to voluntarily conserve electricity, Monday, July 11 between 2-8 p.m. as extreme hot weather created record power demand across Texas.

Along with the conservation appeal, ERCOT also issued a watch for a projected reserve capacity shortage from 2-8 p.m. on July 11. As of July 10, no system-wide outages were expected.

The grid operator noted that conservation is a reliability tool ERCOT has deployed more than four dozen times since 2008 to successfully manage grid operations.

The notification is issued when projected reserves may fall below 2,300 megawatts (MW) for 30 minutes or more.

In a recent episode of the American Public Power Association’s Public Power Now podcast, Woody Rickerson, Vice President of System Planning and Weatherization at ERCOT, detailed ongoing efforts by the grid operator to bolster reliability in the state.

The Southwest Power Pool (SPP) reported that it set a peak load record on July 11 as region-wide electricity use reached 51,377 MW. This surpassed SPP’s previous record of 51,090 MW set July 5, 2022.

Meanwhile, PJM on July 11 said it issued a Hot Weather Alert for its Mid-Atlantic region for July 12 in anticipation of 90-degree temperatures.

A Hot Weather Alert helps to prepare transmission and generation personnel and facilities for extreme heat and/or humidity that may cause capacity problems on the grid. Temperatures were expected to go above 90 degrees.

The Mid-Atlantic region is made up of the Atlantic City Electric, Baltimore Gas and Electric, Delmarva Power & Light, Jersey Central Power & Light, Met-Ed, Penelec, PECO Energy, Pepco, PPL Electric Utilities, PSE&G, and Orange & Rockland (Rockland Electric Company) transmission zones.

PJM said it was prepared to serve a forecasted summer peak demand for electricity of approximately 149,000 MW but has performed reliability studies at even higher loads — in excess of 157,000 MW.

PJM has approximately 185,000 MW of installed generating capacity available to meet customer needs, with sufficient resources available in reserve to cover generation that is unexpectedly unavailable or for other unanticipated changes in demand, it said.

Last year’s peak demand was approximately 149,000 MW.

New York DEC Denies Air Permit Renewal To Cryptocurrency Mining Power Plant

July 8, 2022

by Peter Maloney
APPA News
July 8, 2022

New York State’s Department of Environmental Conservation (DEC) has denied renewal of an air permit to a 107-megawatt (MW) power plant in Yates County that is used to power computer operations for proof-of-work cryptocurrency mining.

In denying a Title V air permit renewal for Greenidge Generation in the town of Torrey, the DEC cited the dramatic increase in greenhouse gas emissions from the facility since the passage of the state’s Climate Leadership and Community Protection Act driven by “the change in the primary purpose of its operations.”

The power plant originally was fired by coal. The previous owners relinquished their Title V permit in 2021. When it bought the plant and switched fuel primarily to natural gas, Greenidge obtained a five-year Title V permit in September 2016.

The DEC noted that in its original permit application, Greenidge said the generating plant would be used as a peaking plant to sell electricity on a limited basis into the New York Independent System Operator (NYISO) market. “At that time, Greenidge did not indicate that it intended to utilize a significant amount of the energy generated by the Facility behind-the-meter for its own purposes,” The DEC said in its letter denying the permit renewal.

In the letter, the DEC goes on to document that between 2017 and 2018 Greenidge did not provide any energy to cryptocurrency mining operations and virtually all energy was used for NYISO peaking purposes. However, that output profile changed over the years, rising to about 10 percent of output for cryptocurrency operations in 2019 to nearly 55 percent in 2021. Meanwhile the overall energy generated by the plant also increased during that period.

In addition, the DEC said that plant’s greenhouse gas (GHG) emissions rose “drastically” over the years to almost tripling in 2020 from its 2017-2019 emissions output.

In its denial, the DEC said the plant’s continued operation would be inconsistent with the statewide statutory limits in GHG emissions because actual GHG emissions from the facility have increased; the rise in GHG emissions is primarily the result of Greenidge’s change in the primary purpose of the plant, and renewal of the permit would allow Greenidge to continue to increase its GHG emissions.

New York State’s Climate Leadership and Community Protection Act, which went into effect on Jan. 1, 2020, establishes economy-wide requirements to reduce statewide GHG emissions to 40 percent below 1990 levels by 2030, and 85 percent below 1990 levels by 2050.

In a statement, Greenidge said it would continue to operate the plant under its existing Title V permit “for as long as it takes to successfully challenge this arbitrary and capricious decision.”

Greenidge also noted that on March 25 its proposed reducing the facility’s permitted GHG emissions by an additional 40 percent by 2025, five years before the 2030 first emissions reduction target date. Greenidge also proposed to be a zero-carbon emitting facility by 2035, five years before the statewide target.

Greenidge further said in its statement that the DEC “never once engaged Greenidge since March 25th to finalize a Permit that would dramatically reduce GHG emissions and preserve upstate jobs.”

In its letter, the DEC acknowledged that Greenidge proposed “limited GHG mitigation measures” and “vague assurances” in its March 25 submission, which was filed after the close of the public comment period, and said those measures “are also insufficient, adding, “They would only provide minimal GHG mitigation and not fully account for the substantial increase in GHG emissions due to the Facility’s change in its primary purpose of operation.”

APPA Urges EPA To Withdraw Proposed Ozone Federal Implementation Plan

July 8, 2022

by Paul Ciampoli
APPA News Director
July 8, 2022

The Environmental Protection Agency (EPA) should withdraw a proposed Federal Implementation Plan (FIP) addressing regional ozone transport for the 2015 Ozone National Ambient Air Quality Standards, the American Public Power Association (APPA) said in recent comments.

The proposed FIP provides for ozone season NOx reductions from electric generating units and industrial stationary sources.  For EGUs, EPA proposed unprecedented NOx reductions due to effective retirements due to costly selective catalytic reduction (SCR) installation requirements and timeframes in addition to reduced capacity factors.  The proposed FIP also introduces stringent new concepts such as a daily NOx rate, dynamic budgeting, and routine allowance bank recalibrations.

APPA’s June 21 comments recommend EPA publish a supplemental proposed rule that would correct many of the errors and assumptions under which the proposal is basedEPA published the proposed FIP in April 2022.

In the proposed rule, EPA claims to adhere closely to the four-step Cross-State Air Pollution Rule (CSAPR) framework that it has used in recent interstate transport rules to address interstate transport for the 2015 ozone national ambient air quality standard (NAAQS).

At the same time, EPA outlined changes to reflect “lessons learned from the performance of regulatory programs established by previous interstate transport rulemakings” and to incorporate “recent information on the nature of ozone transport and emissions reductions opportunities.”

“This is a vast understatement of the magnitude of the Proposed Rule’s deviations from EPA’s CSAPR framework,” APPA said.

EPA’s proposed changes to the electric generating unit trading program – including “dynamic budgets” and other proposed “enhancements” — exceed EPA’s authority under the Clean Air Act, APPA asserted.

To the extent EPA moves forward with its proposal, APPA offered a set of recommendations to improve implementation.

It said that EPA should undertake full notice-and-comment rulemaking if the agency adjusts state emission budgets from year to year and where state emission budgets are subject to year-over-year change, EPA should conduct an overcontrol analysis in those years.

EPA should also correct its air quality modeling in urban coastal areas to account for the unique characteristics of ozone formation in those areas. EPA must also conduct a new overcontrol analysis of these coastal areas using corrected modeling, APPA said.

EPA should increase compliance flexibility in the Groups 2 and 3 trading programs, it added.

And EPA should update its Reference Case analysis, NOx control technology modeling, cost projections, and equipment installation timelines, APPA said.

Reliability Concerns

Other industry stakeholders such as regional transmission organizations (RTO) and independent system operators (ISO) commenters raised concerns with EPA’s proposed FIP, pointing to energy reliability concerns due to the forecasted and rapid loss of fossil-fuel-fired generation by 2026.

In a joint set of comments filed by the Electric Reliability Council of Texas, Inc.; Midcontinental Independent System Operator, Inc. (MISO); PJM Interconnection, L.L.C. (PJM); and Southwest Power Pool, Inc. (SPP) the RTOs/ISOs observe that the proposed FIP could cause reliability challenges because:

•            RTOs/ISOs are currently experiencing declining reserves when higher reserve margins are needed to address “extreme weather, high load conditions and generator retirements;”

•            Time is needed to construct new generation and build transmission facilities;

•            Thermal generators provide essential reliability services;

•            The SCR installation date in 2026 presents a potential grid reliability concern due to likely retirements; and

•            The Proposed Rule may cause non-retiring assets to operate at lower levels.

 The RTOs/ISOs advocated for a “Reliability Safety Valve.” The Safety Valve concept was floated as part of the Clean Power Plan, as well. Here, the specifics of a safety valve are not defined in the Joint comments, but the RTOs/ISOs stated that it would not be a “blanket exemption” from compliance.  Rather, a safety valve would be “tools and processes” tailored to address reliability issues.

Now that the comment period is closed EPA will be working to review the comments and draft a final rule which is expected next March.