Trump’s Coal Rescue Plan Will Force Taxpayers To Bail Out A Dying Industry

Jun 4, 2018 by



The Trump administration is considering a plan that would order utility companies to purchase electricity from coal and nuclear generating plants even though the cost of that electricity will be higher than what they pay natural gas facilities and renewable suppliers. In other words, the Trump administration wants to force you to buy more expensive, dirtier electricity that is more likely to cause you health problems and perhaps even premature death.

coal fired generating plant

Bloomberg reports a memo outlining the plan is circulating inside the administration. The memo, marked “Draft” and “Not for further distribution,” was leaked to Bloomberg. “Federal action is necessary to stop the further premature retirements of fuel-secure generation capacity,” the 41 page memo begins.

The plan would establish a “Strategic Electric Generation Reserve” much like the nation’s strategic oil reserve. The stated purpose of the reserve is to ensure the United States always has a ready supply of electricity to power its defensive capabilities in the event of damage from severe weather events (see Puerto Rico for more on that subject) or cyber attacks on the electrical grid. It is specious to suggest cyber attacks would not target the entire electrical grid, regardless of the source of its power, but it is impossible to apply logic to the arguments of ideologues.

To implement the plan, the US Department of Energy would order utility companies to purchase power from a designated list of facilities “to forestall any future actions toward retirement, decommissioning or deactivation,” for a two-year period. During that time, existing coal and nuclear facilities would be required to keep producing electricity even if they were scheduled to be decommissioned in the interim.

The two-year window would give the DOE time to conduct a study that will supposedly prove natural gas generating plants and renewables are not capable of meeting the electrical needs of the nation in an emergency and that only coal and nuclear plants have that ability. The problem was made more acute recently when natural gas supplies to generating plants in the northeast were constrained by increased demand during bitterly cold winter weather.

The argument is that renewables can’t deliver a constant supply of electricity when the sun doesn’t shine and the wind doesn’t blow and that natural gas plants are reliant on supplies from pipelines. If those pipelines cannot deliver their product for any reason, the facilities will be forced to shut down, making the US electrical grid vulnerable.

“Too many of these fuel-secure plants have retired prematurely and many more have recently announced retirement,” the memo reads. It suggests they have been replaced by less-secure, less-resilient natural gas and renewable power sources, despite much evidence precisely to the contrary (distributed generation offers greater security and resilience). The two-year grace period is a  “prudent stop-gap measure” while the department addresses the nation’s “grid security challenges,” according to the memo.

Everyone who reads CleanTechinca on a regular basis has been watching in wonder as the price of renewables has gone down, down, down in recent years. We all see what’s going on. Renewables are now cheaper than coal or nuclear. In a world where nothing but the bottom line matters, that trend means zero emissions electricity is the wave of the future, right?

Well, not quite. “National security” trumps (you should pardon the expression) every other consideration. No one can ever argue against national security, especially in post 9/11 America. What better way for coal and nuclear advocates to pull the rug out from under renewables than to wrap their cause in the flag? No one would dare challenge coal and nuclear if they are vital to the national defense, would they?

This is brilliant marketing from the likes of Robert Murray, who heads the largest privately owned coal company in American and has ready access to Trump himself. “This action is essential in order to protect the resiliency and reliability of our nation’s electric power grids,” Murray wrote in an email to Bloomberg on June 1. Murray and Joseph Kraft, head of Alliance Resource Partners, donated $1 million to the Trump inauguration fund.

People in America don’t even attempt to disguise their corruption any more. They revel in it and defy anyone to do anything about it. The United States government is now one of the largest criminal enterprises in the history of the world, with the head crook being Donald Trump himself. It seems to be proud that graft is rampant across the land and anyone who doesn’t play the game will suffer.

According to Bloomberg New Energy Finance, American power generators are expected to retire or announce the retirement of 16,200 megawatts of coal-fired power plant capacity and 550 megawatts of nuclear plant capacity in 2018. Two dozen nuclear plants with a total capacity of 33 gigawatts are either scheduled to close or will become unprofitable by 2021.

The DOE proposes to justify its unprecedented interference in electrical markets based on two existing statutes — the Federal Power Act, which allows the government to guaranteed profits for power plants that can store large amounts of fuel on site, and the Defense Production Act, a Cold War–era statute once invoked by President Harry Truman to help the steel industry.

The so-called study of grid resiliency will be one of those modern day fake data exercises so beloved by think tanks and lobbyists. The process goes like this: First, determine the conclusion you want to arrive at. Second, find data to support the desired conclusion.

“It’s going to be tough to get a court to question DOE’s factual finding — particularly if it relates to national defense,” Ari Peskoe, director of the Electricity Law Initiative at Harvard University tells Bloomberg. Basing its actions on two statutes simultaneously could give the administration more “legal room,” he says. The last time the Defense Production Act was invoked was in 2001 during the California energy crisis. At that time, DOE ordered natural gas sellers to prioritize contracts for Pacific Gas and Electric Co.

It is important to decode what is going on here. The coal and nuclear industries have been cozying up to Trump (and the Republican Party) since well before the 2016 election. They can see the handwriting on the wall. They know they are about to get hammered in the marketplace. They know most of their investments are in stranded assets that will become valueless in the near future. They are in a panic because of the Xavier Onassis principle — never suffer a financial loss if you can foist it off onto the shoulders of others — in this case, American taxpayers and utility customers.

Trump and his cronies like to crow that government should not pick winners and losers in business. Yet, when push comes to shove and one of their big campaign donors needs a helping hand from Uncle Sugar, their lies are exposed as they do precisely that. Making this about national security is a brilliant tactic designed to cut detractors off at the knees and give Faux News all the excuse it needs to raise a hue and cry about how the administration is keeping us all safe.

Horse puckey. What it is doing is lying through its teeth in order to take care of major donors. It is killing us all softly with pollution and nuclear waste while sending us the bill.

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About the Author

Steve writes about the interface between technology and sustainability from his home in Rhode Island and anywhere else the Singularity may take him. His muse is Charles Kuralt — “I see the road ahead is turning. I wonder what’s around the bend?” You can follow him on Google + and on Twitter.

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