Chatterjee of the Federal Energy Regulatory Commission (FERC) criticizes the clean energy standard and claims that carbon price may unite US energy policy

Chatterjee of the Federal Energy Regulatory Commission (FERC) criticizes the clean energy standard and claims that carbon price may unite US energy policy

Participants in┬áthe discussion on national green power standards said FERC has a key role to play in advancing the uptake of renewable power in the United States, particularly in terms of the need for an additional transmission. Chatterjee, on the other hand, voiced concern that the present political atmosphere could jeopardize FERC’s ability to keep energy markets stable.

Although utilities are used to adopting long-term decisions regarding assets that will last decades, the political atmosphere has caused uncertainty in the energy sector in recent years, according to Chatterjee. Since 2005, he noted, the United States has virtually lacked a federal energy strategy outside of the tax law, and has pursued and then abandoned efforts like the Clean Power Plan as well as the Paris Agreement when presidential administrations changed.

FERC has now become a stabilizing influence for electric companies amid this back-and-forth, according to Chatterjee. This is why he expressed concern about current congressional discussions regarding a government clean energy mandate.

“What makes me anxious about the way [the green power standard] is being framed is that we need permanency and stability,” he remarked. It comes down to a vote. Because no single Republican will vote on this, you’ll need all of the Democrats to vote yes. You simply cannot afford to lose any of them. It’s also not beneficial if power transfers within few years and the situation is reversed.”

Chatterjee, on the other hand, indicated backing for federal carbon pricing, adding that he believes it may serve to integrate diverse state systems rather than aiming to replace them. In the lack of common criteria, FERC has been forced to evaluate market efficiencies against “the liberty of states to pursue their own energy decisions,” according to Chatterjee.

“It’s been a tough battle,” he admitted. “It’s not like the commission went in with the intention of picking winners and losers. We were attempting to achieve efficient and effective market signals and attempting to find the greatest balance.”

Other panelists chimed in on the advantages and disadvantages of carbon pricing versus a national green power standard. As per Peter Kelly-Detwiler, who is the co-founder of energy consultancy firm Northbridge Energy Partners, putting a carbon price would work well in competitive markets. However, he believes it might have unexpected consequences if it raises the cost of power, driving consumers back towards fossil fuels to run their automobiles, for example.

According to him, a national green power standard would shut down 185 coal-fired power plants and halt the construction of 250 new gas plants. This could hasten decarbonization, but it could also place a greater strain on states that still have a long way to go to meet the 2030 target of 80 percent carbon-free energy, which has been proposed as a national norm.

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