The potentially deadly combination of two EPA proposed policies: the carbon and methane rules

Destabilizing U.S. power grids seems to be a feature, not a bug, of EPA proposed rules.

My Substack article posted December 19, 2023, titled “Natural gas expected to generate half of U.S. electricity in 2024 and EPA announces new methane rules that will reduce natural gas supplies,” highlighted that natural gas power generation has become the primary fuel for maintaining the stability and integrity of America’s electricity grids. Natural gas power generation has become increasingly crucial as more unreliable wind and solar have been added to U.S. power grids. Yet, the EPA seems even more determined to destabilize U.S. power grids by imposing severe restrictions on U.S. natural gas production through methane reduction rules that could shut down a significant portion of U.S. natural gas production.

The day after my Substack article was posted, Michelle Bloodworth, President of America’s Power, filed comments about the EPA’s carbon rules, which the EPA proposed last May. America’s Power analysis began with bullet points emphasizing that grid reliability experts such as North American Electric Reliability Corporation have warned for over a decade about the potential risk of electricity shortages caused by retiring coal plants. Yet, the EPA has ignored these warnings and has proposed rules that will further destabilize U.S. power grids.

Ms. Bloodworth’s comments said that the EPA’s latest proposed rules are so flawed that “EPA should withdraw the Carbon Rule and repropose a new rule that corrects the rule’s myriad flaws, that is supported by solid reliability analysis, and that does not cause electricity shortages or operating reliability problems.”

America’s Power comments to the EPA are captured in the following bullet points:

-Coal retirements are increasing the prospect of an electric reliability crisis. Already, utilities have announced plans to retire some 81,000 megawatts (MW) of coal-fired generation (almost half the existing coal fleet) within the next six years. 
 
-As currently designed, the Carbon Rule will cause even more coal retirements, further exacerbating reliability risks. We estimate that more than 100,000 MW of coal are at risk of retiring prematurely because of the Carbon Rule’s requirements to limit capacity factors, co-fire substantial amounts of natural gas, or install carbon capture technology by January 1, 2030.
 
-Various warnings about coal retirements and potential reliability problems extend as far back as 10 years prior to EPA proposing its Carbon Rule. In particular, the North American Electric Reliability Corporation (NERC) has issued at least 21 reports warning of potential reliability problems due largely to the retirement of coal and other dispatchable resources. Despite these warnings, EPA has continued to develop and implement rules that will cause more coal retirements.
 
-Existing mechanisms, such as reliability-must-run agreements or Department of Energy 202(c) orders under the Federal Power Act, are not adequate to mitigate reliability problems resulting from a large number of coal retirements.
 
-EPA should withdraw the Carbon Rule and repropose a new rule that corrects the rule’s myriad flaws, that is supported by solid reliability analysis, and that does not cause electricity shortages or operating reliability problems.
 
-Any Carbon Rule should provide maximum flexibility for states to design implementation plans so as to prevent reliability problems. Such flexibility includes allowing states to establish alternate, less stringent emission reduction requirements and compliance deadlines that take into account “remaining useful life and other factors.” States should be allowed to implement these measures through an informal and expedited administrative process.

The complete analysis is excellent and can be read here.

My take: Ms. Bloodworth and America’s Power nailed it. Alarm bells that U.S. power grids have become increasingly destabilized have been sounding for years. NERC has repeatedly stated that U.S. grid instability has already reached dangerous levels. Yet, EPA has ignored the warnings and continued to march forward with rules that will cause U.S. power grids to fail. Coupled with EPA’s recently proposed methane rules reducing U.S. natural gas production, U.S. power grids will increasingly face failures and threaten the stability of the U.S. economy.

Since the EPA is not likely to change its proposed rules, the Supreme Court will hopefully intervene and stop the implementation of both proposals. Otherwise, a change in the administration is the only way to change the course of this out-of-control EPA and restore America’s power grid’s ability to provide reliable and stable power.

The EPA should listen to Michelle Bloodworth and withdraw their proposed carbon rules as well as their proposed methane rules.

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