June 11, 2018 Read More →

Trump order to prop up coal plants will increase electricity bills in West Virginia

Charleston Gazette:

As West Virginians continue to see their utility bills rise, the regional electric grid serving the state is among those warning that attempts by President Donald Trump’s administration to keep coal and nuclear power plants from closing will lead to higher electricity prices.

Trump has ordered the U.S. Department of Energy to stop unprofitable coal and nuclear power plants from closing due to what his administration says are concerns for national security and grid reliability. An internal White House memo outlined a plan to keep the plants alive, Bloomberg News reported. The department would direct grid operators to purchase power or generating capacity “from a designated list of facilities” for two years to put impending closures on pause, according to the report.

But the PJM Interconnection, which operates the electric grid serving West Virginia and others, said earlier this month that there “is no immediate threat to system reliability.”

That conclusion isn’t anything new. A U.S. Department of Energy report released in August stated that grid “reliability is adequate today despite the retirement of 11 percent of the generating capacity available in 2002, as significant additions from natural gas, wind, and solar have come online since then.”

PJM also said a marketplace with limited government interference “has led to historically low prices.”

“Any federal intervention in the market to order customers to buy electricity from specific power plants would be damaging to the markets and therefore costly to consumers,” it said.

Jacqueline Roberts, director of the state Public Service Commission’s Consumer Advocate Division, said “someone has to pay for the subsidies, and that includes [West Virginia] ratepayers.”

There are still plenty of questions industry players have for the White House. Roberts said that “no one knows the subsidy mechanism yet” that will be pursued. Cathy Kunkel, a Charleston resident and analyst for the Institute for Energy Economics and Financial Analysis, agreed, saying “the devil is in the details” on how the plants will be kept alive.

“I’m not sure how you would effectively design a program like this,” Kunkel said. “Would there be a set price floor for coal-fired power plants? Would [grid operators] be buying a certain amount of their generation?”

West Virginia is home to 10 active coal-fired power plants, according to the U.S. Energy Information Administration, and coal-fired plants accounted for 94 percent of the state’s net electricity generation in 2016. But coal-fired power plants are shutting down across the country as natural gas and renewable energy sources increase their share of the marketplace.

Trump order could prop up WV coal plants, but many warn of consumer cost

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