Energy

Regulator: Enacting Energy Department’s Coal Push Would Have Been Unlawful

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Chris White Tech Reporter

A Trump-appointee responsible for nixing the Energy Department’s coal gambit said Friday that energy regulators had to reject the proposal because it was “following the law.”

The agency’s proposal to prop up the coal industry was not a proper role for the Federal Energy Regulatory Commission (FERC), Neil Chatterjee, a member of the commission appointed by President Donald Trump, told Axios in an interview.

“I understand conservative frustration with it. It was a tough issue. Part of that stems from the judicious role that FERC plays. We’ve got to abide by the statutes that govern us. … I can understand how that’s frustrating to people. We are not betraying conservative principles. We are in fact following the law,” Chatterjee said.

The regulatory commission unanimously rejected a proposal in January that would effectively subsidize coal and nuclear power plants facing closure. Energy Secretary Rick Perry’s proposal would have compensated power plants that keep 90-days-worth of fuel on site, at mostly nuclear and coal plants.

Trump and Perry are set on providing a life-raft for the coal industry. The industry has struggled to stay afloat ever since natural gas became one of the top fossil fuels in the energy market. Coal workers also blame former President Barack Obama for using regulations to bludgeon the beleaguered fuel source.

Still, some conservatives and free market-types criticized the agency’s plan. They argue that Perry, a former Texas governor and free market advocate, should know better than to support policies that tilt markets in favor of one industry.

“There is no free market, but you don’t fight intervention with intervention,” said Tom Pyle, the president of free market group Institute for Energy Research. “He’s recognized the symptoms but he’s not proposing the right cure.”

ALSO WATCH:

Perry’s proposal came shortly after the Energy Department completed a report in August showing that coal plants are shuttering because they cannot compete with cheap natural gas and, to a lesser extent, subsidized green energy technology. The agency billed the study as monumental in scope, but the findings dovetail with what most analysts have been saying for several years.

Most of the coal and oil retirements from 2011 to 2015 happened because plant owners chose to shut down rather than invest in expensive instruments required to comply with the Environmental Protection Agency’s final Clean Power Plan rule that was finalized during the Obama administration.

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