After the Energy Department conducted a reliability study a year ago, Energy Secretary Rick Perry proposed a rule that would have compensated coal and nuclear plants for their ability to store months' worth of fuel on site.
President Donald Trump said Friday he believes the nation's coal-fired and nuclear plants are vital to national security, and he directed Energy Secretary Rick Perry to take "immediate steps" to keep them open.
The White House-sponsored DoE memo reportedly states that "too many of these fuel-secure plants have retired prematurely and many more have recently announced retirement", while declaring that the replacement of coal and nuclear plants by natural gas and renewable power in the USA is not secure.
"This prudent stop-gap measure" will allow coal and nuclear plants to remain open while the department takes further steps to secure the grid, the memo said.
A "Strategic Electric Generation Reserve" would also be created under the order "to promote the national defense and maximize domestic energy supplies", the draft memo said.
The department's intervention is meant to buy time for a two-year study of vulnerabilities in the American energy delivery system - from power plants that provide electricity to the natural gas pipelines that supply them.
While many of President Trump's top donors advocate for the support of struggling coal-fired power plants, it is unclear as to whether or not Trump has signed off on the plan.
"With coal and nuclear plants already closing at alarming rates, the reliability of America's electric grid is at risk", he said.
Maria Korsnick, president and CEO of the Nuclear Energy Institute, applauded Friday the administration's effort to retain nuclear facilities as national security assets though she admitted to not having seen the details of the reported proposal.
The American Council on Renewable Vitality, a nonprofit that represents numerous teams that wish to emphasize renewable power sources, stated in an announcement that the administration is intervening to bail out coal and nuclear energy vegetation "which are now not aggressive on their very own".
Earlier this year, east coast grid operator PJM, which serves 65 million customers, published an analysis of recently announced planned deactivations of certain nuclear plants and determined that there was no immediate threat to system reliability. Farrell called the draft plan "a misapplication of emergency powers" and said, "There's certainly no credible justification to force American taxpayers to bailout uneconomic power plants".
Invoking national security concerns could bolster the Trump administration's case in any legal challenges over the intervention, said Ari Peskoe, director of the Electricity Law Initiative at Harvard University. It relies on authorities given to the executive branch in the Defense Production Act of 1950 and the Federal Power Act. "We urge policymakers to again block this ill-advised effort to keep plants running that most electric utilities have already chose to abandon - and for good reason". The operator for much of the Mid-Atlantic, it says it has "secured reliable supplies through 2021/2022" and that this kind of federal intervention "would be damaging to the markets and therefore costly to consumers".
Perry in September asked the Federal Energy Regulatory Commission to consider "guaranteeing financial returns" for power plants able to "stockpile" 90 days worth of fuel on site.
"Orderly power plant retirements do not constitute an emergency for our electric grid", said Amy Farrell, vice president of the American Wind Energy Association.