By Frank Andorka, Senior Correspondent
What Happened: The Federal Energy Regulatory Commission (FERC) passed a rule by a vote of 2-3 (no, we’re not sure how that’s a thing either) that
- Tries to usurp the rights of states to set their own clean-energy goals.
- Privileges fossil fuels over renewable electricity sources by not accounting for the full value of energies like wind and solar.
SolarWakeup’s View: For the moment, let’s set aside the issue of the Republicans’ mythical support of “states’ rights,” which they largely ignore when inconvenient on a multitude of issues, to which you can now add electricity generation.
Miles Farmer, a National Resources Defense Council lawyer, was all over the order on Monday, three days after it was issued shortly after midnight (the whole thread is worth reading, so see the link below).
Here’s why this issue is critical to the development of solar and wind. In a typical wholesale energy market, where prices are determined through a process of competitive bidding, utilities that own some production would manipulate prices by submitting artificially low bids to drive down prices. Then they would buy energy from other suppliers at those suppressed prices
FERC has prevented market manipulation by setting minimum prices for energy. In the past, however, the rule did not apply to renewable energy sources
which, in many cases, are supported by the government. The new rule, issued Friday, requires the minimum price stipulation to apply now to renewable sources.
The bottom line for renewables is that they are being penalized for being supported by state governments – but FERC deliberately ignores the state supports for traditional fossil fuel generation. So the order, instead of leveling the playing field as it purports, tips the field in the direction of fossil fuels and, in the process, usurps the states’ ability to support clean energy.
For those of you with short memories, FERC earned mad props earlier this year for rejecting a Department of Energy directive to subsidize nuclear and coal plants. The new order it issued Friday, however, essentially accomplishes the same thing without the negative publicity.
As Farmer notes, however, the rule isn’t final yet and will inevitably be appealed. So there’s still hope this odious rule won’t go into effect. But we best be vigilant because this rule could do significant damage to the renewables’ industries – and we must be ready to fight this with everything we have.
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