# Powelson rejects Polar Vortex arguments



## georgepds (Oct 22, 2017)

There's an idea, proposed by Rick Perry of the DOE, that there should be price support for coal and nuclear plants because they are more reliable in bad times, like the polar vortex. He says the reason is they have fuel on site

" Federal Energy Regulatory Commission member Robert Powelson dismissed the notion that natural gas generators "didn't perform" during the Polar Vortex in a Monday speech, rejecting a main assumption behind Department of Energy's cost recovery rule for coal and nuclear plants. "

This is a discussion between those who want to preserve competition in the power markets and those who want to pick their sources (coal and nuclear). If price support is enacted renewable and gas sources will be more costly by comparison

Both Perry and Powelson are Trump appointments.

http://www.utilitydive.com/news/pow...s-underpinning-doe-cost-recovery-plan/507436/


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## begreen (Oct 22, 2017)

I wouldn't expect logic to prevail, nor science. It's no longer a question of do the right thing. It's now a matter of who paid the most campaign dollars and provides loyal support.


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## WoodyIsGoody (Oct 22, 2017)

begreen said:


> I wouldn't expect logic to prevail, nor science. It's no longer a question of do the right thing. It's now a matter of who paid the most campaign dollars and provides loyal support.



I would say I'm stunned but nothing about the actions of this administration stun me any more.

I do know what made this country great in the first place was unified support behind science based solutions, not stuff just made up to benefit a few. The last thing we need are more fossil fuel subsidies. How come I don't see the same people who rail against solar subsidies rail against this?


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## georgepds (Oct 22, 2017)

But I think there is logic in the discussion. Powelson clearly favors a free market in electric energy sources, Perry does not. His (Perry's) response to congress: “I think you take costs into account, but what's the cost of freedom?"

BTW Ferc makes the rules here. Ferc Commissioners serve five-year terms, and have an equal vote on regulatory matters. There are 3 commissioners now

Here's a summary of what ferc does

https://www.ferc.gov/about/ferc-does.asp


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## vinny11950 (Oct 23, 2017)

Just wait for the new budget and taxation priorities to be implemented.  It will be an ambitious plan to give us third-world infrastructure and government.


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## georgepds (Oct 23, 2017)

@Vinniy11950.. You bring up a good point. Since these payments are to power plants ( not necessarily owned by the electric distribution companies), the cost might not be billed to the rate payer. This means they would come out of general US funds

If there is a move to limit the deficit ( Yeah, I know, Ha Ha) then there would be push back on new expenses


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## vinny11950 (Oct 23, 2017)

I think all these recommendations are secondary to budget allocation priorities.  The current administration has expressed a desire to boost coal, nuclear, and oil so they will do that, funding producers/owners of those assets and cutting off funds to everything else.  And when they pass this huge $1.5 Trillion tax cut, federal agencies and programs will be scrambling to cut non-priority programs just to balance their budgets because the funding has disappeared.  It's a 2 hammer approach to budgeting - spend the money on something else and then cut funding - it leaves everything else up for spending cuts.

This will happen across the board - Energy, health, state department, FEMA and so on.  Forget about a real infrastructure bill like we used to see in the 80s and 90s.  And how are we going to pay for Harvey and Maria relief?  Or all the wild fires out west? 

I can't blame them either, because they ran on this platform so they are just following through on it.  It is the people that voted for them that don't realize how much we all depend on the federal government to meet so many of our different needs.


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## begreen (Oct 23, 2017)

This plan worked great in Kansas.


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## peakbagger (Oct 23, 2017)

Technically there was an issue in warm weather climates when the polar vortex hit southern areas that normally didnt  have extended freezing. Many natural gas power plants especially peakers were built outside with many components open to the weather, these are cheaper to build when you dont need to put it in building. Natural gas pressure reducing stations were built the same. Cheap to build but move in extended below freezing conditions and these plants go down or the gas supply fails due to upstream issues on the transmission system. Texas didnt (And I dont think they do yet) have capacity markets so shutting down a plant due to very rare freezing is just a loss of revenue to be balanced against initial capital cost to freeze proof. Put in a capacity market and if the plant goes down the owner has to pay to replace the lost generation no matter what the cost and then the incentives are a lot higher to build for cold weather.

Natural gas plants can be built for cold weather, plenty of them in New England.


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## vinny11950 (Oct 23, 2017)

Here's a good article on the issue from Dave Roberts at Vox.

https://www.vox.com/energy-and-environment/2017/10/20/16502386/grid-resilience-reliability

_“How many big power plants with big piles of fuel do you have?” is a caveman approach to resilience. As many critics have already noted, big piles of fuel would have done nothing to help in the wake of the polar vortex, Hurricane Harvey, or the other recent US disasters. There are many kinds of disruptions and disasters that can be planned for, but many can’t (and this will become even more true as climate change progresses). The key to resilience is a system that holds up under a wide variety of possible conditions.

To build that kind of system, grid operators will need to draw together a diverse array of resources on both the supply and demand side. In his order, Perry purported to be addressing resilience and reliability but completely passed over demand-side tools — the increasing ability to shrink or shift consumer demand, in real time — which are some of the most promising.

“Market operators are trying to incorporate societal needs and state preferences into reliability and market rules,” Silverstein says, “but they need help (as do state and federal regulators) to design cost-effective, risk-moderating portfolios of supply- and demand-side resources that will deliver lasting value under diverse, uncertain future paths.”_


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## georgepds (Oct 23, 2017)

Confirm that Texas does not have a capacity market

A capacity market means you pay some plants to stay available when you need them

http://www.theenergycollective.com/...-how-capacity-market-works-and-why-it-matters


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## georgepds (Oct 23, 2017)

A good article on this issue appeared in the  WSJ today


https://www.wsj.com/articles/enviro...fight-against-electrical-grid-plan-1508677201

*Trump Plan for Coal, Nuclear Power Draws Fire From Environmental, Oil Groups*


"The unusual battle lines that have ensued put coal miners and a small group of power companies that stand to benefit up against nearly the entire rest of the energy industry—both fossil and renewable fuels—plus consumers and environmentalists. It has also flipped some traditional economic orthodoxies, with Democrats saying they are arguing for free markets while Mr. Perry and some Republicans are justifying subsidies to help nuclear and coal compete.


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## georgepds (Oct 24, 2017)

another article on the opposition

https://stateimpact.npr.org/pennsyl...ys-plan-to-subsidize-coal-nukes-not-workable/

"PJM Interconnection, the region’s electric power grid operator says the Trump administration’s proposal to subsidize coal and nuclear is “unworkable.....


But PJM’s Ott says even some coal and nuclear plants couldn’t operate during that period. Ott says threats to the grid come more from downed power lines during big storms, and storing coal would not help that. During large storms, some nuclear plants shut down. Coal supplies froze during the Polar Vortex, and were saturated with water during Hurricane Harvey.

He says market-based solutions should form the basis of grid reliability.

“We think part of the problem with the DOE proposal is it really, fundamentally undermines competitive markets and competitive signals,” he said.

Ott says the proposal would not stand up to legal scrutiny under the Federal Powers Act, which forbids favoring one form of energy over another."




I'm not sure what provision of the federal power act he refers to. If you look it up on wikipedia it was first past in 1920, and amended several times. Some of the amendments clearly favor one type of energy over another


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## peakbagger (Oct 24, 2017)

One of my past clients had a 40 MW turbine that we did an upgrade to. For its entire life it has been a capacity machine. It has big oil tank and a natural gas connection. The owner gets paid for it to be ready to run when the SHTF. Its quite near the Atlantic coast and expect the only reason it will ever get dispatched is that the local grid goes down. Connecticut has installed several 50 MW simple cycle plants around the state. They too sit next to a very large distillate (jet fuel) tank. The owner reportedly rents the capacity out for arbitrage with the agreement that if the grid goes down, the plant has the first pick. The plants footprint with 4 turbines is puny, just a couple of acres far smaller than a coal plant and far more reliable. They go from zero to full output in 15 minutes. GE is now deploying similar turbines in CA with a built in battery bank, if there is short term disturbance they can use the batteries and not even start up the turbines or if they think it will be long term they can dump the batteries into the grid while the turbine is getting up to speed. 

The only reason to keep a coal plant running is cheap fuel. Add in carbon impact and its loser., everyone knows it but politicians in  for the short term would rather prolong the suffering of those impacted by the closures then doing the hard work of rebuilding an economy in areas impacted.


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## begreen (Oct 24, 2017)

One would think that a distributed system would be more resilient in the event of a catastrophe. Large dependencies on a single-source of power seems to be inherently vulnerable. It would seem that this is even more true in light of escalating cyber warfare and hacking attacks. Thoughts?


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## peakbagger (Oct 24, 2017)

A mix of the two are the way to go. Combined Cycle natural gas plants are the most efficient plants out there. They unfortunately need to be large in order to get the efficiency's. Most are in the 600 plus MW range. If nukes are still around they are only going to get bigger. Speculation on fusion plants is that if an when they go commercial they also will be huge. I heard reference once to having one plant supply all of New England. 

New England is getting ready to bet the farm on Canadian hydro sourced from far northern Quebec via just a couple of power lines. The bet is being hedged by installing a lot of peakers. Much as micro grids sound appealing unless there is substantial energy storage in the grid there is usually a need for back generation, usually fossil fuel.


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## Ashful (Oct 24, 2017)

begreen said:


> One would think that a distributed system would be more resilient in the event of a catastrophe. Large dependencies on a single-source of power seems to be inherently vulnerable. It would seem that this is even more true in light of escalating cyber warfare and hacking attacks. Thoughts?


If you changed the word “would” to “should”, in your first sentence, you’d be closer to the truth.  Being intimately familiar (via familial tie) to distribution for what was until very recently the largest electric utility in the world, I can tell you their failure management plans are something right out of the 1940’s.  It is a horrendous affair, as evidenced by the great northeast black-out of 2003.

Attempts to improve this system of failure management, using technology such as theater battle management core systems (TBMCS, think Ageas), have failed to win the required congressional budgetary support.  So, they just keep trodding along using decades-old techniques of pre-calculated failure management protocols.  These are typically calculated for any combination of up to three failures, which in the case of the great northeast blackout, proved to be entirely inadequate.


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## peakbagger (Oct 24, 2017)

Just for the chuckles, my part of northern NH didn't trip during the great East coast blackout in 1965. The region is a net renewable power producer with only one feed to the grid, when the voltage started to sag at the switchyard, the breaker opened and the area islanded. Some advantages to living out in the sticks.


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## georgepds (Oct 24, 2017)

peakbagger said:


> ....
> 
> New England is getting ready to bet the farm on Canadian hydro sourced from far northern Quebec via just a couple of power lines.....




I looked up the power of the proposed Quebec lines: 

"Among several plans yet to secure final approval are the $1.4 billion Northern Pass project, designed to bring 1,090 megawatts ( 1GW) of Hydro-Québec power through New Hampshire into southern New England and a 1,000-megawatt (1 GW) transmission line beneath Lake Champlain in Vermont. ...

http://montrealgazette.com/news/massachusetts-plan-could-spur-hydro-quebec-exports-to-new-england

The   2 GW  from  Hydro Quebec are ~ 6.6% of current capacity .( ISO New England says there are ~30 GW in New England in 2016)

Here is the resource breakdown in New England.. 

https://www.iso-ne.com/about/key-stats


_350 generators

29,200 MW of generating capability (July 2017 summer seasonal claimed capability)

About 45% of regional generation lists natural gas as its primary fuel source, with over 11% more listing it as a secondary fuel

13,351 MW of new generating capacity, mostly natural gas and wind, proposed to be built through 2024, though many projects ultimately withdraw (source: August 1, 2017, ISO Interconnection Queue)

4,200 MW of non-gas-fired generating capacity retired or retiring 2012–2020, with over 5,500 MW from coal- and oil-fired plants at risk of retirement in the coming years

400 MW of active demand response (DR) and 2,300 MW of energy efficiency through the capacity market_


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## georgepds (Oct 24, 2017)

Not sure if hydro Quebec is really the big bet in New England. Poking around the iso-ne site I found this graph. It looks like the big bet is natural gas

https://www.iso-ne.com/about/region...lenges/natural-gas-infrastructure-constraints


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## peakbagger (Oct 25, 2017)

Its more than you think, HQ has several other basins they can flood and basically has offered to build as much ponded hydro as New England will sign long term contracts for. 
HQ is a huge entity that calls the shots in Quebec, they pretty well own the market in Quebec and the only way they can grow is to add a larger customer base and that is New England. Once new england states declare hydro as renewable (its currently regarded as brown non renewable hydro) HQ can sell at very significant profit compared to wind and solar. 

There are several other large transmission lines proposed http://www.masslive.com/news/index.ssf/2017/07/transmission_hydro_and_wind_de.html. There also at least one underwater line proposed from Newfoundland to Plymouth Mass. 

The problem currently is that the big combined cycle natural gas plants burn non firm gas so on high demand days, they can not readily be dispatched when the are needed most, they cant add load as sometimes there isnt surplus non firm gas to buy. Of course right now there is a lot of press where two large firm gas owners in the region are playing games with their capacity.


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## georgepds (Oct 25, 2017)

peakbagger said:


> Its more than you think, HQ has several other basins they can flood and basically has offered to build as much ponded hydro as New England will sign long term contracts for.
> .....



Thanks

That's quite an offer.. do you know where I can read about it.?


Looks like the problem will be the transmission lines. ISO -NE says that we import 17% of power, I have no idea how much additional capacity they have.. The iso-ne discusses current transmission

https://www.iso-ne.com/about/key-stats/transmission

Here are the stats from the above

*Fast Stats*

_9,000 miles of high-voltage transmission lines (115 kV and above)_
_13 transmission interconnections to electricity systems in New York and Eastern Canada_
_17% of region’s energy needs met by imports in 2016_
_730 project components placed in service across the region since 2002 to fortify the transmission system; 137 planned, proposed, or under construction, as of the June 2017 Regional System Plan Project List_
_23 Elective Transmission Upgrades (ETUs) proposed as of the August 1, 2017, ISO Generator Interconnection Queue, totaling over 16,000 MW of potential transfer capability, which would help access non-carbon-emitting resources_


EIA publishes and interesting map of all registered power plants and transmission lines in the US

https://www.eia.gov/state/maps.php

For those interested in detail.. iso ne publishes a map of the transmission lines in New england


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## peakbagger (Oct 26, 2017)

I read a lot of different publications to get my info and file them away in my mind thus I cant give you links. Generally the best HQ news is out of Quebec news sources when HQ is in the news. Wikapedia may be a good start on getting you mind wrapped around HQ
https://en.wikipedia.org/wiki/Hydro-Québec. The vast majority of Quebec shown on the map is undeveloped boreal forest, the only residents are native tribes and in the past HQ has ignored their rights which is one of the reasons some new england states discouraged buying power from them in the past.

If you look into the governance section they basically are stuck supplying low cost power to Quebec residential customers so their growth is to export and they have been aggressively promoting themselves behind the scenes in New England which is working under the Regional Greenhouse Gas Initiative (RGGI), this indirectly forces states to promote current costly renewables which are not readily dispatchable. HQ pumps a lot of money back into the Quebec government which is relatively poor with high social welfare costs compared to Western provinces which are cashing in on fossil fuel extraction so they actively support HQs expansion.  Quebec has some limited gas near the NY border but its mostly solid rock so no big fossil resources. Therefore the politicians tend to let HQ do what they want as long as the voters are happy. Do note they also own Gaz Metro so they get a cut of any gas exports like the PNGTS line.

The section on export also should give you an idea on where they are going. NB Power might have been a competitor but they are struggling. Unlike the US the majority of rural land in Canada is Crown land owned by the government so they can get things done far easier than the US.


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## georgepds (Oct 31, 2017)

More on the players... here in OHIO

Coal (Murray Energy) and nuke plant owners (FirstEnergy ..both coal and nukes) are in favor of the rule, 

Those opposed include
the PUC,
the Office of the Ohio Consumers’ Counsel ,
PJM Interconnection said the proposed rule “is .. unlawful..."
the Environmental Defense Fund



http://midwestenergynews.com/2017/1...over-plan-to-prop-up-coal-and-nuclear-plants/


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## georgepds (Nov 6, 2017)

So, some in the know think it's just a political payoff


"Ex-GOP FERC regulator: DOE NOPR 'a tax on customers' to benefit Murray, FirstEnergy"

"The Department of Energy's proposal to provide cost recovery to coal and nuclear plants is "just a tax on customers" designed to "do favors" for friends of the Trump administration, a former Republican federal energy regulator said Tuesday. "

"the administration soon turned to Section 206 of the FPA, which allows DOE to initiate rulemakings at FERC, as the vehicle for its controversial cost recovery proposal.

https://www.utilitydive.com/news/ex...ax-on-customers-to-benefit-murray-fir/509724/


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## georgepds (Dec 9, 2017)

Latest

https://www.utilitydive.com/news/pe...y-extension-on-cost-recovery-proposal/512654/

Secretary of Energy Rick Perry on Friday begrudgingly granted the Federal Energy Regulatory Commission 30 more days to act on his agency's controversial cost recovery proposal for coal and nuclear plants, warning that doing so would mean continued risk to the nation's electric system.Perry wrote that while the "better course of action" would be to act on the DOE proposal by Dec. 11, he would grant the extension "under the assumption that the Commission cannot act within the original 60-day deadline." In the interim, Perry wrote he would "examine all options in my authority ... to ensure the security of the nation's electric grid."The extension came in response to a request from FERC Chairman Kevin McIntyre, who wrote to DOE late Thursday asking for more time to analyze the proposal. McIntyre noted FERC has added two new regulators in the past two weeks and received more than 1,500 comments on the plan.


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## georgepds (Dec 9, 2017)

The two group analysis of the comments. Pretty good.. which group are you ?

https://www.utilitydive.com/news/the-doe-nopr-aint-a-damn-thing-changed/512448/

First, there are the market purists, who continue to insist that Restructured Administrative Markets are fine (never-mind the myriad of already-existing interventions and price distortions). ....

The difficulty, at the blackboard economics level, is that a neoclassical competitive market clearing at the marginal cost of production does not present an opportunity to recover fixed costs....

The second group of commenters are the end of game proponents, the “winning isn’t everything — it’s the only thing” point of view. For these commenters, it does not matter how we achieve a particular result from a legal or regulatory perspective so long as the result ends up killing fossil generators, with nuclear as an unfortunate (or in some cases desired) casualty. ....

Forget about constitutional consistency. Expect those advocating for state rights to protect renewables to jettison those principles when it comes to fossil fuels.


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## peakbagger (Dec 9, 2017)

I am waiting to see how the proposed subsidies are written. There is a already a small country wide fleet of renewable power plants that are capable of being dispatched and store 90 days of fuel. They are called biomass power plants. I hope they get the same treatment as coal and nuclear.


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## georgepds (Dec 9, 2017)

Good point... renewables were 8%of iso ne load today, with 
wood 46%, Refuse 33%, And landfill gas 3% of that, all of which qualify under simple interpretation of the proposed subsidy

https://www.iso-ne.com/isoexpress/web/charts


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## peakbagger (Dec 10, 2017)

Unfortunately, the devils are in the details. Northern New England in particular doesnt have coal but it does have a low grade wood market. This market is needed to encourage landowners to manage their land more actively. Back years ago there were quite a few biomass power plants in rural areas in the region, these were small plants that would fit nicely into a distributed energy model. Sadly many have gone away but there is still are quite a few around struggling to keep open. Unfortunately the owners are small players competing with very large competitors so they have little voice. They also dont have access to various subsidies and incentives that other renewable do.


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## georgepds (Dec 12, 2017)

Vox weighs in.You get a sense of their opinion from the attached quote ( clue: they hate it) , but the article is a good review of the players for (few) and against ( many) the proposal

https://www.vox.com/energy-and-environment/2017/12/9/16745084/rick-perry-coal-bailout-ferc

"The decision will serve as a barometer measuring how deep partisan hackery has penetrated the federal bureaucracy. It has become extremely clear since Perry debuted his proposal that it is nothing but pure crony capitalism — a bid to heap rewards on a few wealthy friends, with no larger justification."


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## georgepds (Dec 29, 2017)

Latest

https://www.utilitydive.com/news/af...urray-says-he-never-proffered-grid-re/513771/

Coal mining company Murray Energy filed comments with the Federal Energy Regulatory Commission (FERC) asserting that it did not propose the Department of Energy’s controversial cost recovery proposal for coal and nuclear plants in wholesale markets. The filing came after the publication of photos showing CEO Bob Murray in March delivering a coal “Action Plan” to Secretary of Energy Rick Perry that called for plant payments similar to the DOE’s proposal. Environmental groups filed comments last week asking FERC to dismiss the proposal because the text “closely resembled” DOE’s eventual proposed rulemaking.




Photos here


http://inthesetimes.com/features/murray_energy_trump_doe_coal_industry_grid_plan.html


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## georgepds (Jan 8, 2018)

Proposal rejected



https://www.washingtonpost.com/news...al-and-nuclear-plants/?utm_term=.1344f66b5ff6
"

"The Federal Energy Regulatory Commission on Monday unanimously rejected a proposal by Energy Secretary Rick Perry that would have propped up nuclear and coal power plants struggling in competitive electricity markets.


"The law and common sense prevailed over special interests today,” John Moore, director of the Sustainable FERC Project Coalition, said in a statement. “The FERC correctly found that the Department of Energy’s proposal violated the basic requirements of the Federal Power Act.


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## peakbagger (Jan 9, 2018)

I expect the new ball to drop is to replace the FERC commissioners until they vote the way the administration wants

Seems to work for net neutrality and many EPA policies


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## vinny11950 (Jan 9, 2018)

peakbagger said:


> I expect the new ball to drop is to replace the FERC commissioners until they vote the way the administration wants
> 
> Seems to work for net neutrality and many EPA policies



They are going to do what they do.....

But at some point there has to be a reckoning with reality.  I mean we can't keep trying to turn back the clock to make a lie true.


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## georgepds (Jan 9, 2018)

peakbagger said:


> I expect the new ball to drop is to replace the FERC commissioners until they vote the way the administration wants
> 
> Seems to work for net neutrality and many EPA policies



I think 4 of 5 commissioners are newly appointed.. so not likely

Their response, to give the DOE cover, was to  thank Perry for bringing up the issue of resilience, and a promise to study it


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