ENERGY REGULATORS SAY NO TO TRUMP. Regulators Rule Against Trump Administration. All of that money would have gone to plants that, among other requirements, kept a 90-day fuel supply on site..By Todd Horwitz, Bubba Trading

 

Tuesday January 10, 2017

ENERGY REGULATORS SAY NO TO TRUMP

Regulators Rule Against Trump Administration

Federal energy regulators on Monday rejected a Trump administration proposal aimed at shoring up struggling coal-fired and nuclear power plants to bolster the nation’s electricity grid, saying the administration hadn’t persuaded them the plan was needed to ensure the system’s reliability.

The administration plan, proposed in September, is one of its biggest initiatives to help those fuels compete amid a boom in gas-fired and renewable power. The Energy Department submitted the proposal, warning that so many coal-fired and nuclear plants are under threat of closing that the country’s electric grid faced a rising risk of outages and price spikes without it.

Energy Secretary Rick Perry had ordered the Federal Energy Regulatory Commission to act by this week to guarantee financial payments to the plants that could be facing retirement because of the rise of natural gas and renewable energy, a strategy that many critics said would undermine the power markets the regulator has spent decades building.

But in a 5-0 decision announced Monday, FERC formally axed Perry’s proposal and instead ordered the nation’s regional grid operators to submit information about their ability to judge “naturally occurring and man-made threats” to their systems within 60 days. That order essentially puts off any action until at least April, if the agency decides to implement any measures at all.

In a statement, Perry said he was pleased his proposal had sparked a national debate, and said he looked forward to the agency’s probe into “the marketplace distortions that are putting the long-term resiliency of our electric grid at risk.”

The Trump administration never gave an estimated cost for the proposal, but an analysis from consulting firm ICF International Inc. said consumers would pay an additional $1 billion to $4 billion a year. All of that money would have gone to plants that, among other requirements, kept a 90-day fuel supply on site—essentially nuclear and some coal generators—to guarantee their costs and “fair return on equity” are covered whenever they operate.

Keep those stops tight
Todd “Bubba” Horwitz

Financial & Political Commentary

 

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Todd Horwitz - Author of “Average Joe Options“. Todd began his trading career in 1980 at the CBOE. He was one of the original traders in the OEX & helped start the SPX. He is a member the CME where he trades S&P futures as well as foreign currencies & is a regular contributor to CNBC, Bloomberg, BNN, Fox & many other major news networks.