Senate Dems warn Perry about grid study

Source: Hannah Northey, E&E News reporter • Posted: Tuesday, May 2, 2017

Senate Democrats say a much-touted Department of Energy study on subsidies and grid reliability could serve a well-connected conservative think tank in Washington: the Institute for Energy Research.

Seven senators warned Energy Secretary Rick Perry in a letter today against allowing “ideologues associated with a Koch Brothers-affiliated think tank” to supplant research and analysis from federal scientists, engineers and grid monitors.

The lawmakers were referring to Perry’s request for a 60-day study on premature coal and nuclear plant closures. Travis Fisher, formerly an economist at IER and the Federal Energy Regulatory Commission, has been tapped to lead the effort, according to sources.

Fisher has written and spoken publicly about the harm to the U.S. electric grid from state and federal policies supporting renewable power sources.

The Democrats said they fear that the administration is “embarking on an initiative aimed at bolstering the views of a group of special interests seeking to resurrect electric generation technologies that can no longer successfully compete on their own.”

Signers of the letter include Senate Energy and Natural Resources ranking member Sen. Maria Cantwell of Washington and Sens. Ron Wyden of Oregon, Debbie Stabenow of Michigan, Al Franken of Minnesota, Martin Heinrich of New Mexico, Mazie Hirono of Hawaii and Tammy Duckworth of Illinois.

“You should not allow this to happen,” the senators wrote to Perry.

IER President Tom Pyle dismissed the Democrats’ warning shot as merely politics, calling it a “not-so-thinly disguised attempt” by the left to discredit the study’s results and the author even before its release.

“It’s unfortunate, but not surprising, that these senators would try to discredit organizations and individuals simply because they disagree with them instead of engaging in a constructive dialogue on an important subject,” Pyle said.

Pyle, the former leader of President Trump’s DOE transition team, leads IER and its advocacy arm, the American Energy Alliance.

The nonprofit, which markets itself as an advocate for free-market policies, was established by former Enron Corp. executive Robert Bradley Jr. to oppose regulations and rules that group backers say are distorting the energy markets.

Perry, in a leaked memo to his chief of staff, Brian McCormack, requested a review of how “federal policy interventions” are affecting the markets, whether attributes like on-site fuel are appropriately compensated, and whether regulatory burdens and “mandates and tax and subsidy policies” are triggering early coal and nuclear plant closures.

Perry said the study should “explore critical issues central to protecting the long-term reliability of the electric grid, using the full resources and relationships available to the department,” and set a mid-June deadline.

The Senate Democrats argued that those parameters ignore the more substantial threat of cheap natural gas to baseload power plants and overlook benefits that solar and wind generators bring to the overall system.

They also said Perry’s approach appears to blame wind and solar for the financial struggle coal and nuclear plants are facing, while overlooking the more dominant pressure of cheap gas.

“It does not take a Ph.D. in economics to understand that it is historically low natural gas prices that are challenging the viability of other conventional generating sources in electricity markets,” the lawmakers wrote.

Other energy insiders have expressed concern that such a quick look could leave out existing and ongoing research on the integration of renewables into the electric grid. They have also questioned DOE’s lack of communication about the memo and study.

Perry did not consult in advance with organizations that run the nation’s energy system and top experts, including FERC, the North American Electric Reliability Corp., the Electric Power Research Institute and the PJM Interconnection (Energywire, May 1).

A trio of clean energy groups representing businesses across the solar, wind and efficiency sector called on Perry to ensure that the study allows for public comment.

While the senators focused on Fisher and IER, Perry in recent days has personally made his thoughts clear on at-risk nuclear and coal plants.

While in New York, the secretary said DOE could intervene in state energy planning that it deems a threat to the survival of baseload coal generation and nuclear power (Energywire, April 26).

Fisher is not the only IER alumnus leading a high-profile DOE effort. Last week, the agency announced that Daniel Simmons, a former executive of the conservative think tank, would lead a regulatory task force to comply with a presidential memo calling for agencies to cut red tape and consider rules for reform or elimination (E&E News PM, April 28).