OPC seeks rehearing of Department of Energy report on electric reliability, citing concerns about customer impacts
BALTIMORE – The Department of Energy’s recent report evaluating electric reliability across the United States is fundamentally flawed and cannot lawfully be used to subvert existing ratepayer protections of state and regional processes designed to maintain reliable service, the Office of People’s Counsel told the DOE yesterday in a request for rehearing of the report.
“The DOE report could result in needless excess costs to customers,” Maryland People’s Counsel David S. Lapp said. “It draws alarming conclusions about reliability risks without considering the existing frameworks under state law and the Federal Power Act for maintaining reliability. The report appears intended to keep old, costly power plants on-line regardless of the need or the impacts on customers.”
Because the report intends to serve as support for future DOE orders to keep power plants on-line, it operates as a regulation, OPC’s comments point out. But it did not comply with legal requirements for creating a new rule, and it failed entirely to consider current processes for maintaining reliability and keeping power plants on-line for reliability purposes.
In the PJM regional market in which Maryland participates, rules and processes are in place to keep sufficient power plants available to address reliability. Federal regulators have approved those rules and processes, but the DOE report never considers them, making the DOE report’s conclusions arbitrary.
Moreover, OPC’s comments explain, depending on how the DOE’s conclusions are used, they could violate the Supreme Court’s major questions doctrine. That doctrine prohibits federal agencies from exerting agency authority over “major questions” which would typically be left to Congress to decide.
By law, the DOE’s limited authority to require power plants to stay on-line—before this year, rarely used—exists to address “emergencies” and “sudden” increases in demand or supply shortages for short periods, but the DOE report appears geared to support keeping selected resources on-line outside of emergency conditions, OPC’s filing states. If the report is used to justify keeping selected plants from retiring for extended periods or outside of emergency conditions, as it appears to be intended, that would exceed the powers Congress gave the DOE.
The DOE recently used its emergency authority to require a Michigan power plant—long planned for retirement—to stay on-line at an estimated cost to Michigan ratepayers of $600 million a year. The DOE report anticipates future orders to support data center growth, which could “cause needless consequences for consumers,” OPC said.
The Maryland Office of People’s Counsel is an independent state agency that represents Maryland’s residential consumers of electric, natural gas, telecommunications, private water and certain transportation matters before the Public Service Commission, federal regulatory agencies and the courts.
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