PoliZette

A Modest Proposal to Help Protect America’s Energy Grid Reliability

A temporary tax credit would go a long way toward keeping enough coal-generated electrical power to get through high-demand times

When it comes to energy policy, the hot topic in Washington these days is “grid resilience.” In essence, this means how do we keep the lights on, even during extreme weather events like the recent extended cold snap and “bomb cyclone” in the Northeast?

In the past, it’s meant a heavy reliance on both coal and nuclear power, along with a smaller portion of natural gas generation. But now, after eight years of the Obama administration’s poorly conceived energy policies, coal-fired power plants are becoming an endangered species — and closing at an alarming rate.

Ironically, recent events have proven that the United States needs these coal plants to supply reliable and affordable electricity, especially when demand is high due to extreme weather. The question becomes, how do we prevent these vital coal plants from shutting down prematurely?

Fortunately, Congress is starting to tackle the problem. Rep. Larry Bucshon (R-Ind.) recently introduced the “Electricity Reliability and Fuel Security Act,” which aims to keep coal-fired power plants operating in the near-term while federal policymakers find long-term remedies to ensure the nation’s electric grid resilience.

Bucshon’s bill would create a temporary tax credit to offset a small portion of the maintenance and operating expenses of the existing coal fleet.

Electricity is essential to our daily lives. Every time we turn on the lights, charge our smartphones, turn on the air conditioner, or heat our homes, we use electricity. That’s why keeping electricity affordable and reliable is so necessary.

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And right now, roughly one-third of America’s electricity is generated by coal. But that sturdy, affordable share of the nation’s power supply will continue to decline unless recent policies are reversed.

Coal is considered resilient because coal-fired power plants normally maintain several weeks’ worth of on-site fuel supplies. This means that coal plants can continue to run, even if the supply chain is disrupted.

This is a reassuring contrast to natural gas power plants, for example, which have little or no on-site storage capacity. Essentially, if natural gas pipelines are unable to deliver supplies, the plants that rely on their on-demand fuel simply can’t generate electricity.

And then there’s the issue of renewable energy sources like wind and solar — which have received massive federal subsidies for close to four decades now.

Since 2010, almost 108,000 megawatts of coal-fired generating capacity has shut down or been announced as closing. The worry, as these reliable baseload power plants are dismantled, is that the nation’s power grid may not be able to handle the electricity needs of consumers during a sustained period of peak demand like 2014’s polar vortex or the January 2018 extreme cold snap.

The United States needs an “all of the above” strategy when it comes to energy policy in this country. Ensuring that utility companies possess a diverse mix of electricity sources, including coal, is essential for grid reliability and resiliency.

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We can look back to almost a century where electricity generated from coal has proven to be one of the most reliable, fuel-secure, and affordable sources of electricity. Does anyone doubt that, without coal-fueled electricity, many Americans would have been left in the dark and in the cold?

In order to ensure that Americans continue to have access to the reliable and affordable electricity that coal helps to provide, it’s time to level the playing field of tax subsidies for competing energy options.

The “Electricity Reliability and Fuel Security Act” is a temporary measure — lasting only five years — while policymakers, including at the Department of Energy and the Federal Energy Regulatory Commission, figure out the best mix of fuel sources to keep America’s grid reliable and resilient.

But it’s an important near-term measure, and Congress should move quickly to pass Rep. Bucshon’s bill before the nation faces even more coal retirements.

Terry M. Jarrett is an energy attorney and consultant who has served on both the National Association of Regulatory Utility Commissioners and the Missouri Public Service Commission.