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Coal, nuclear power are vital to grid reliability and national security, McKinley says

By JIM ROSS

The State Journal

CHARLESTON, W.Va.  — The change in administration in Washington means coal and nuclear power can again be considered important to maintaining the electric power supply during emergencies, says Rep. David McKinley, R-W.Va.

Rep. David McKinley, R-W.Va.

“Now we have someone across the table who’s willing to listen to the threat. Now we have a DOE secretary who’s on board,” he said.

McKinley made his comments, Oct. 5, about a week after U.S. Energy Secretary Rick Perry asked the Federal Energy Regulatory Commission (FERC) to consider a rule that would change how electricity from coal and nuclear power is priced on the market.

Perry’s proposed rule requires that electricity markets develop and implement rules that accurately price generation resources necessary to maintain the reliability and resiliency of the grid. Specifically, the rule allows for the recovery of costs of fuel-secure generation units, that is, coal and nuclear power plants that can keep a 90-day supply of fuel on site.

McKinley says the polar vortex of 2014 exposed the vulnerabilities of a generating system that relies too much on natural gas and renewables. Coal-fired power plants that were scheduled for retirement later that year had to be put into service to meet the demand for electricity as natural gas supply was diverted for home heating use, he said.

“Since that time, those plants are all gone,” McKinley said.

Perry’s letter to FERC dated Sept. 29 said the resiliency of the electricity grid is threatened by the premature retirement of coal-fired and nuclear power plants. The grid needs power that can be provided by plants that can keep at least 90 days of fuel on hand, he said.

The only two power sources that can do that now are coal and nuclear, McKinley said.

He said nuclear power meets the 90-day requirement best, and coal is second-best. Gas-fired plants rely on just-in-time delivery that can be affected by supply problems or perhaps terror attacks, he said.

Jennifer Young, spokeswoman for FirstEnergy, said her company is waiting for details of Perry’s plan to be worked out.

“We view this definitely as a positive development,” she said. “It’s too early to tell what impact it will have.”

McKinley said the government needs to study ways for gas plants to store a supply on site or nearby so they can deal with supply interruptions.

“I don’t know how to do that,” he said. “In the meantime, let’s make sure we don’t retire any more coal or nuclear plants until we have an option.”

McKinley said some opposition has arisen to Perry’s request because of the possible increase in electricity rates. He says the two questions are separate.

“The fight is not over cost of utilities,” he said. “The fight is over national security. Do we have a system capable of maintaining electricity during a crisis like we just experienced?”

American Electric Power spokeswoman Melissa McHenry said Perry’s proposal does not determine how to value 24/7 generation, but leaves that question to others. Perry’s proposal directs FERC and others to find the best way to compensate baseload generation as it is dispatched, meaning it does not earn a return when it is not running.

“In addition, the proposal appears to focus on competitive generation rather than competitive and regulated power plants, both of which support grid reliability and resiliency,” McHenry explained. “We appreciate the Department of Energy’s interest in addressing pricing mechanisms that value grid resiliency. Current market structures do not adequately recognize the full benefits provided by 24/7 generation, including coal and nuclear. This generation is needed for stability and reliability of the energy grid as our nation’s generation fleet continues to transition to cleaner energy.”

Staff Writer Jim Ross can be reached at 304-395-3483 or email at [email protected]

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