Today the Alliance for Industrial Efficiency filed comments on the Federal Energy Regulatory Commission (FERC) Notice of Proposed Rulemaking on Grid Reliability and Resilience Pricing. Energy Secretary Rick Perry has called on FERC to write a rule by Dec. 11 that could impact electricity prices throughout the United States. Secretary Perry asserts an interest in enhancing grid reliability and resilience by promoting electricity-generation sources with 90 days of fuel stored on site—most likely coal and nuclear power.
In response, the Alliance highlights the resiliency benefits of clean and efficient combined heat and power (CHP), noting that: (1) Below-ground infrastructure is more reliable than electric systems; (2) CHP is a reliable technology; and (3) CHP has a track record of performance during natural disasters. Indeed, according to EIA data, less than 0.00007 percent of reported outages can be attributed to fuel supply problems, belying FERC’s reliance on fuel supply as an indicator of reliability. We argue that if FERC determines that technologies that improve the reliability of the grid deserve appropriate pricing in electricity markets, then CHP should likewise enjoy a reliability pricing benefit. Read our full comments online here.