Daily Archives: February 18, 2018

Future of US Energy Debated Between Industry Pros and Federal Government

The Trump administration has proposed several new rules, repeal of existing rules, and other policies in order to promote coal as a fuel for power plants and to promote nuclear energy. One of their arguments is that the US grid is in a crisis and the more sources of energy the greater the resiliency and reliability of the grid, which will help the economy grow. For example, the U.S. Department of Energy requested that older power plants receive federal subsidies to continue to operate and to enable others to store up to 90 days of fuel on site to enhance reliability given problems with the grid.

In the latest budget proposal, the Trump Administration recommended a decrease in federal funding of renewable energy from about $2 billion to about $0.5 billion, by 72%. Most of this decline would be sharp reductions in research spending, including an 82% cut to research on fuel efficient vehicles, an 82% cut on research into bioenergy technologies, and a 78% cut for solar energy technology research. Congress must approve this for it to go into effect. The Administration proposed a similar large cut in renewable energy programs in the previous year, but it was rejected by Congress.

The Federal Energy Regulatory Commission (FERC), many members the president had appointed, rejected the arguments about grid reliability. In January, FERC voted down the idea of subsidies for coal-firing, saying that keeping alive older and less efficient plants would not improve reliability. Promoting such energy sources would put the US and its businesses at a disadvantage compared to other countries which promote more competitive energy sources, such as green energy and natural gas, to their businesses.

FERC argued that the grid is not facing a crisis, and that subsidies or preferred treatment for coal or nuclear plants would hurt a competitive electricity market and drive up costs for businesses and consumers. FERC went on to say that it should not favor any market that is costly and non-competitive. FERC also said that current US problems with the grid do not originate from sources of fuel, but, rather, from transmission shortcomings, such as downed power lines. The commission did go on to say that there is room for improvement of the nation’s grid and asked regional transmission organizations and independent system operators for their ideas on improvement.

The Trump Administration has been working to repeal many Obama-era environmental regulations that would hurt coal-fired power plants, combat climate change, and reduce subsidies for renewable power. In many cases, they have succeeded. However, many major US businesses support not only the Clean Power Plan, which President Trump is attempting to repeal but also the Paris Climate Agreement, which the President has announced the US will withdraw from. Such major firms include Alcoa, Berkshire Hathaway, DowDupont, EMC Corp., and General Motors.

CCES can help your firm become both energy efficient and more flexible in terms of the fuel sources it uses to benefit your bottomline. Contact us today at 914-584-6720 or at karell@CCESworld.com.