North Dakota coal industry disappointed by rejected proposal

By: 
THE ASSOCIATED PRESS

BISMARCK, N.D. (AP) — North Dakota coal industry officials are disappointed by the Federal Energy Regulatory Commission’s rejection of a proposal that would have propped up the state’s main power source.

The U.S. Department of Energy issued the proposal last fall to compensate power plants for keeping coal on hand. The commission unanimously decided against adopting the proposal on Monday because it failed to meet a Federal Power Act standard.

“We are disappointed in yesterday’s determination by the Federal Energy Regulatory Commission,” Lignite Energy Council President Jason Bohrer said in a statement Tuesday, the Bismarck Tribune reported. “Currently, regional electricity markets do not properly compensate generators who produce ‘always on’ power or whose power is not susceptible to weather disruptions.”

The Energy Department’s proposal came after an agency study calling for grid resiliency in the nation’s power supply. The department defines resiliency as the ability to recover from natural or man-made disasters that disrupt fuel supply. The department said that resiliency has been threatened in recent years by increasing plant closures due to regulation and competition from cheap natural gas.

Energy Secretary Rick Perry had suggested that the commission adopt a rule that pays baseload power plants for have 90 days’ worth of fuel onsite.

In its decision, the commission cited the Federal Power Act standard that requires showing that existing tariffs are “unjust, unreasonable, unduly discriminatory or preferential” before implementing tariff changes.

The commission said that standard was not met, but formally requested that electric grid operators show their efforts to ensure their grids remain resilient.

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