FERC Should Define, Foster and Retain Resilience 1 May 11–May 17, 2018 A report to members of the Nuclear Energy Instute In This Issue www.nei.org FERC Should Define, Foster and Retain Resilience ICF study finds changes to generaon mix outpacing planning framework RTOs must include fuel security risks in long-term planning to assure grid resilience NEI asks for fuel security risks to be analyzed before nuclear plants can rere May 11, 2018—While short-term prices connue to drive the premature rerement of nuclear power plants, the Federal Energy Regulatory Commission (FERC) must act to define resilience to fully understand whether the grid can withstand and recover from high consequence events, NEI told FERC this week. NEI also pressed for addional analysis of how nuclear rerements and the increased reliance on natural gas could impact grid resilience. Last September, Energy Secretary Perry directed FERC to “take swiſt acon” to address threats to the resiliency of the U.S. electric grid and issue a rule requiring organized markets to develop rules to compensate “fuel-secure” electricity generators for the resiliency they provide to the U.S. grid. However, this January FERC declined to adopt the U.S. Department of Energy’s proposed rulemaking and instead directed the regional transmission organizaons (RTOs) and independent system organizaons (ISOs) that manage the electric grid to assess the resilience of the bulk power system and recommend addional acons to migate any idenfied issues. FERC gave the RTOs and ISOs 90 days to provide comments. NEI’s May 9 comments to FERC note that the RTOs and ISOs now acknowledge they have not adequately considered fuel security risks in their long-term planning. “Taken together, the RTO comments simply do not demonstrate that the grid is ready to handle the increasing reliance on gas-fired generaon. They also fail to assure [FERC] that the loss of nuclear generaon to early rerement will not increase the resilience risk of the rush to gas,” NEI Vice President, General Counsel and Secretary Ellen Ginsberg said in the comments. NEI commissioned a recent study by consulng firm ICF, “The Impact of Fuel Supply Security on Grid Resilience,” which demonstrates that the grid’s move to natural gas has “outpaced the framework for analyzing the resilience implicaons of those changes,” Ginsberg said. The ICF report is included as an appendix to NEI’s comments. To understand and migate resilience risks, NEI urges FERC to undertake three parallel acons: Define resilience to incorporate the importance of fuel security, especially on the need for diverse, long-term fuel-secure resources instead of a sole focus on short-term reliability metrics.
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FERC Should Define, Foster and Retain Resilience
1
May 11–May 17, 2018
A report to members of the Nuclear Energy Institute
In This Issue
www.nei.org
FERC Should Define, Foster and Retain Resilience
ICF study finds changes to generation mix outpacing planning framework
RTOs must include fuel security risks in long-term planning to assure grid resilience
NEI asks for fuel security risks to be analyzed before nuclear plants can retire
May 11, 2018—While short-term prices continue to drive the premature retirement of
nuclear power plants, the Federal Energy Regulatory Commission (FERC) must act to define
resilience to fully understand whether the grid can withstand and recover from high
consequence events, NEI told FERC this week. NEI also pressed for additional analysis of how
nuclear retirements and the increased reliance on natural gas could impact grid resilience.
Last September, Energy Secretary Perry directed FERC to “take swift action” to address
threats to the resiliency of the U.S. electric grid and issue a rule requiring organized markets
to develop rules to compensate “fuel-secure” electricity generators for the resiliency they
provide to the U.S. grid.
However, this January FERC declined to adopt the U.S. Department of Energy’s proposed
rulemaking and instead directed the regional transmission organizations (RTOs) and
independent system organizations (ISOs) that manage the electric grid to assess the
resilience of the bulk power system and recommend additional actions to mitigate any
identified issues. FERC gave the RTOs and ISOs 90 days to provide comments.
NEI’s May 9 comments to FERC note that the RTOs and ISOs now acknowledge they have
not adequately considered fuel security risks in their long-term planning.
“Taken together, the RTO comments simply do not demonstrate that the grid is ready to
handle the increasing reliance on gas-fired generation. They also fail to assure [FERC] that the
loss of nuclear generation to early retirement will not increase the resilience risk of the rush
to gas,” NEI Vice President, General Counsel and Secretary Ellen Ginsberg said in the
comments.
NEI commissioned a recent study by consulting firm ICF, “The Impact of Fuel Supply
Security on Grid Resilience,” which demonstrates that the grid’s move to natural gas has
“outpaced the framework for analyzing the resilience implications of those changes,”
Ginsberg said. The ICF report is included as an appendix to NEI’s comments.
To understand and mitigate resilience risks, NEI urges FERC to undertake three parallel
actions:
Define resilience to incorporate the importance of fuel security, especially on the need
for diverse, long-term fuel-secure resources instead of a sole focus on short-term