Energy and Commerce subcommittee holds hearing on Clean Power Plan challenges
A House Energy and Commerce subcommittee met last week to explore current challenges in the U.S. energy market.
Owing to factors such as the low price of natural gas, the regulations included in the U.S. Environmental Protection Agency’s (EPA’s) Clean Power Plan (CPP) and the financial difficulties facing nuclear power plants, witnesses at the hearing argued that reconciliation between the CPP and the current issues facing the energy market would be problematic.
“How the Clean Power Plan can work on the back of a wholesale energy market, I cannot see. I foresee real difficulties. I cannot fit them together,” Linda Stuntz, former deputy secretary of energy, said.
NEI Senior Director of Business Policy Matt Crozat explained that discrepancies between incentivization programs in different states would create challenges as grid operators sought to accommodate different methods and establish fair prices.
“Under the Clean Power Plan, one state can develop a policy of using a mass-based carbon reduction approach that recognizes existing nuclear while a second state can use a rate-based method that would incentivize new nuclear,” Crozat said. “That could create an issue if the two states are in the same transmission market because the regional grid operator would have to figure out how to fairly accommodate both approaches while setting fair prices for the whole market. Stuntz is highlighting that complexity; it will be a challenge to reconcile the issue.”
