POWER March 2016 - 56

COMMENTARY
Why the Clean Power Plan
Needs a Dynamic Reliability
Safety Valve
John J. Novak
T
he U.S. Environmental Protection Agency's (EPA's) Clean
Power Plan is arguably the most ambitious and far-reaching
regulation in the agency's history. America's electric cooperatives
oppose the rule for a variety of reasons, with its serious
threat to electric reliability topping the list. So, even as the National
Rural Electric Cooperative Association (NRECA) challenges
the fundamental legality of the regulation in court, we are urging
the EPA to incorporate into the rule a robust, dynamic reliability
" safety valve. " This crucial regulatory mechanism would
adjust or postpone the Clean Power Plan's carbon dioxide (CO2
)
emissions targets to ensure that power generators could increase
electricity output to meet unexpected contingencies.
Safety Valve Critical for Co-ops
The safety valve issue is especially important to NRECA members,
because co-ops have fewer generation options than other types
of utilities for responding to unforeseen events that can trigger
power outages. Such events include everything from heat waves
and extreme cold spells to fuel shortages and the failure and
unexpected retirement of other electric generating units, transmission
lines, and gas pipelines. Any of these events, alone or
in combination, could require numerous power plants to increase
their electricity output-and potentially exceed their CO2
emissions
limits-to keep the lights on. And these events are not
without precedent.
In 2012, Unit 3 at the San Onofre Nuclear Generating Station
in California went offline after a small leak of radioactive steam
was discovered; Unit 2 already was offline for scheduled maintenance.
In 2013, Southern California Edison announced that both
units, capable of producing 2,200 MW, would shut down permanently,
removing a large supply of dispatchable, zero-emitting
generation from the grid.
How would states, grid operators, electric co-ops, and other
utilities respond to such exigencies with the Clean Power Plan
in place? Grid operators and power producers would scramble to
find replacement power. Renewables would be ruled out, because
they are not dispatchable baseload sources of energy. Natural
gas generation would be the likely candidate, but its CO2
emissions
would have to be offset under the rule. If electric co-ops
were called on to respond, our emissions almost certainly would
increase, because we rely on coal to produce more than half of
our electricity.
So, what is the EPA's response to all this? Not a problem. There
will be strong emissions trading markets from which generators
in a tight spot can purchase allowances or credits.
Current Safety Valve Is Insufficient
If the EPA is right, power generators will never have to make use
of a dynamic reliability safety valve. So there's no downside to
incorporating one into the Clean Power Plan. But if the agency's
56
■ Identification of triggering events, including unforeseen and
unavoidable circumstances or systemic changes in the availability
and operability of electric energy resources.
■ Clarification of who may apply for relief, which should include
the owner or operator of an affected generating unit.
■ Expansion of available relief and remedial actions, including
the ability of petitioners to request prospective and/or retrospective
relief from an emissions requirement on an annual or
multi-year basis.
■ Definition of the scope of relief, which should include adjustments
in the compliance obligations of affected generating
units without regard to any particular number of triggering
events.
■ Mandatory consultation with the Federal Energy Regulatory
Commission (FERC) on reliability, consistent with FERC's expertise
and authorities under the Federal Power Act.
NRECA believes that the Clean Power Plan is well outside the
EPA's legal authority and should be withdrawn in its entirety.
Nonetheless, we are equally committed to helping America's
electric co-ops find the most cost-effective means to achieve
compliance should the rule survive court review. Adopting a dynamic
reliability safety valve is essential to mitigating the impacts
of the Clean Power Plan and ensuring that electric power
remains reliable and affordable for all consumers. ■
-John J. Novak (john.novak@nreca.coop) is executive director,
environment for the National Rural Electric Cooperative Association.
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POWER | March 2016
assumptions about emissions markets prove to be too rosy, fossil
electric generation will increase, possibly busting state emissions
limits. No co-op or other utility should face steep penalties and
fines for exceeding its Clean Power Plan emissions limits when
responding to a grid emergency. But this is the scenario that
many co-ops are likely to face unless the rule's current safety
valve-which offers only a one-time, 90-day reprieve from emissions
standards-is dramatically improved.
Given the reach of the Clean Power Plan and the complexity
of the grid, it's not surprising that reliability organizations
have flagged concerns, as well. The Electric Reliability Council of
Texas has stated that, " if multiple unit retirements occur within
a short timeframe, there could be periods of reduced systemwide
resource adequacy and localized transmission reliability issues. "
The North American Electric Reliability Corp. found that
the current safety valve " [p]rovides limited flexibility if a state
encounters an unexpected reliability concern. "
In light of these concerns, NRECA in December petitioned the
EPA to accept public comment on its safety valve provisions in
an effort to help the agency develop a more robust reliability
mechanism. We recommended that a new safety valve contain
several key elements, including:
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POWER March 2016

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