New Report: States Can Cut Carbon Pollution and Protect Grid Reliability

States can meet or exceed the proposed limits on dangerous carbon pollution from power plants while preserving the reliability of the electricity flowing to our homes and businesses, according to a new report from the highly respected Brattle Group.

Countering exaggerated claims by opponents of the U.S. Environmental Protection Agency's Clean Power Plan, Brattle finds that the plan offers states a multitude of options to cut carbon pollution from fossil fueled power plants.

We're glad Brattle is helping to set the record straight. The North American Electric Reliability Corporation (NERC), which is responsible for establishing reliability standards for the electric grid, cautioned last November that EPA's proposal could potentially undermine reliability. As I and others have explained, NERC's “sky is falling” message reflect a fundamental misunderstanding of the proposed Clean Power Plan's compliance flexibility.

Fortunately, the Brattle report corrects these misinterpretations, finding that the proposal's many options for states to reduce emissions means that “compliance will not come at the cost of reliability.”

Flexibility is the Clean Power Plan's middle name

Flexibility is the foundation of the Clean Power Plan's design. Any fair assessment of the proposal must account for that flexibility; to do otherwise is folly. Yet NERC overlooked several key flexibility attributes of the Clean Power Plan for states to consider in their compliance strategies. Brattle identified several, including (to name only a few):

  • Flexibility to use an array of technologies and measures to meet the targets, including wind and solar power, energy efficiency, demand response, rooftop solar and other distributed resources, storage, and other options;
  • Flexibility to choose the form of the emission target the state wants to meet—either a tonnage limit on carbon pollution statewide, or a CO2 “speed limit” on how cleanly the statewide electricity fleet runs. (Read more on the two options); and
  • Flexibility for multi-state or regional cooperation to meet some or all of the required reductions.

As Brattle points out, all of this flexibility carries reliability benefits. For example, unlike other pollution control standards, EPA's proposal does not force the retirement of any fossil-fueled plant by a specific deadline. Plants necessary to maintain reliability can continue to operate at lower output levels, and states can offset pollution from those plants with reductions elsewhere.

Unfortunately, “Building Blocks” misconceptions persist

Diving deeper, Brattle took aim at some of the assumptions NERC and others have been using (and misusing) in their negative reports. One of the biggest involves the four “building blocks” EPA used to develop the state targets: improving coal plant efficiency; using gas plants more effectively; increasing renewable energy; and boosting energy efficiency.

Despite beliefs to the contrary, the building block assumptions are not required actions; states are free to use any combination of measures in crafting their state compliance plans. Yet NERC's report largely ignored this critical distinction, choosing to focus on building block assumptions as the basis for compliance. The Brattle report corrects that error, detailing the numerous options available to increase carbon savings beyond the building blocks.

Bullish on ability to meet standards while maintaining reliability

Where the Brattle study really takes the NERC report to task is in its “Review of NERC's Reliability Concerns.” The Brattle analysis provides an extensive discussion of where NERC got it wrong, noting to the contrary that:

  • There is significant excess generating capacity in some regions, so additional power plant retirements can be accommodated without reliability concerns.
  • Few additional natural gas pipelines are needed to supply fuel for natural gas plants (a new U.S. Department of Energy report confirms this).
  • Renewable energy can contribute far more to meeting the Clean Power Plan's targets while preserving and even strengthening reliability.
  • States have many energy efficiency options, including non-utility programs like building codes and standards.

Takeaways

Among the high-level takeaways of the Brattle report are two big ones:

One: NERC's blinkered view of the Clean Power Plan undercuts the credibility of its initial assessment. NERC is planning to release its next evaluation of the Clean Power Plan very soon. NERC should assess the full menu of compliance options in this effort. Otherwise, its views will be, well, unreliable.

NERC's next reliability study could create heartburn for another reason: It hired consulting firm Energy Ventures Analysis (EVA) to help lead the work. EVA has been railing against the Clean Power Plan on behalf of Peabody Energy, the world's largest coal producer and arguably the biggest opponent of carbon pollution standards on the planet. Hiring a firm with such a biased view of the rule is like asking ExxonMobil what it thinks of electric cars. Kidding aside, NERC should find a new consultant.

Two: Good modeling and good data are the foundation of good planning. States need to understand the flexible compliance options available in the Clean Power Plan, and embed them into their modeling and compliance activities.

The Brattle report reaffirms that we can cut carbon pollution from fossil fuel plants “while maintaining the high level of electric reliability enjoyed by U.S. electricity customers.” We are already transitioning away from older, higher polluting technologies of the past; let's keep moving forward.

About the Authors

John Moore

Senior Attorney, Sustainable FERC Project, Energy & Transportation program

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