The report finds that the greatest threats to our power grid are not physical or cyber attacks, but rather existing and upcoming Federal and State policies including subsidies, mandates, and regulations.
IER found that Federal Government policies alone threaten the reliable functioning of 130 gigawatts (GW) of power from natural gas, coal, and nuclear power plants. This is enough power to meet the residential electricity needs of more than 105 million Americans, or one-third of the U.S. population. Other findings include:
COAL: The North American Electric Reliability Corporation (NERC) estimates that 103 GW of coal-fired capacity will shut down as a result of EPA rules. That amount of power could supply the residential electricity needs of more than 80 million Americans.
NUCLEAR: Actions taken by the Nuclear Regulatory Commission (NRC), state policies threatening existing nuclear plants, and subsidies for renewable energy sources that work at cross-purposes with nuclear power will force 8.6 GW of nuclear power to retire.
NATURAL GAS: NERC estimated the impact of natural gas supply constraints during the polar vortex—for several regions—and found that nearly 19 GW of gas-fired capacity was lost.
In addition to these findings, IER also offers up several policy recommendations to prevent these policy threats. These include:
Stop EPA’s Existing Source Rule. States should resist pressure from EPA to comply with the rule, and Congress should do everything in its power to constrain EPA’s authority to enforce it.
Allow the wind PTC to stay expired. The PTC’s negative long-term impact on grid reliability makes this policy a non-starter for anyone who values reliable electricity.
End renewable electricity mandates and subsides. These include state RPSs as well as subsidies and special rate treatment like net metering.
Rationalize EPA’s regulations. EPA’s new regulations affecting power plants harm grid reliability and should be withdrawn as soon as possible.
The Institute for Energy Research (IER) is a not-for-profit organization that conducts intensive research and analysis on the functions, operations, and government regulation of global energy markets. IER maintains that freely-functioning energy markets provide the most efficient and effective solutions to today’s global energy and environmental challenges and, as such, are critical to the well-being of individuals and society.
