3:06 PM 08/14/2017
Federal Energy Regulatory Commission (FERC) Chairman Neil Chatterjee said he would look for ways to “properly compensate” coal plants for providing reliable electricity during his time as a top energy regulator.
“These are essential to national security. And to that end, I believe baseload power should be recognized as an essential part of the fuel mix,” Chatterjee said in a video interview FERC officials posted online Monday.
“I believe that generation, including our existing coal and nuclear fleet, need to be properly compensated to recognize the value they provide to the system,” Chatterjee said.
Chatterjee’s comments are a nod to power plant operators and Republican lawmakers who worry that too much baseload power is being taken offline, in part, due to Obama administration energy regulations.
Sixty gigawatts of coal-fired power has come offline since 2010, according to industry data. While most energy experts blame low natural gas prices, federal environmental regulations and subsidies for green energy likely played a big role in closures as well.
Wholesale electricity prices vary from day to day and reflect a power plant’s marginal cost of generating energy. That means wind and solar power have a distinct advantage over fossil fuels, since it costs them virtually nothing to produce an extra unit of power.
Coal supporters say zero marginal cost electricity, which is sometimes negative thanks to subsidies, want electricity rates to incorporate the benefits of providing 24/7 electricity.
“As a nation we need to ensure that coal, along with gas and renewables, continue to be part of our diverse fuel mix,” said Chatterjee, who served as Senate Majority Leader Mitch McConnell’s energy adviser.
The Senate confirmed Chatterjee to head the FERC in early August. Chatterjee will serve as chairman until David McIntyre is confirmed by Congress, which is slated to happen in November.
FERC is an independent regulatory commission that oversees the electric grid, natural gas pipeline siting, approval of natural gas export terminals and other energy infrastructure projects.
Chatterjee mentioned infrastructure as another major priority for the Republican-controlled FERC. He hopes approving backlogged energy projects will create jobs and help the Trump administration meet its goals.