Draft DOE study blames low demand, not regs, for power plant closures

By Devin Henry - 07/17/17 03:32 PM EDT  thehill.com/policy/energy

 

A draft version of a Department of Energy study into the electric grid blames decreasing demand and low gas prices — but not renewable power or government regulations — for the retirement of traditional power plants.

The study says renewable power and regulations “played minor roles” in the retirement of baseload power plants, traditionally coal and nuclear facilities that supply large amounts of electricity.

Instead, electricity grid changes have been driven by a “long-standing drop in electricity demand relative to previous expectations and years of low electric prices driven by high natural gas availability," according to a June 26 draft version of the report released Monday by ThinkProgress.

The study is expected to change before the Energy Department formally issues its final version, which may become public this month. E&E News reported Monday that the current version of the study pulls out its conclusions about cheap gas and electricity demand, and a spokeswoman told the paper the draft report is not current.

An Energy Department spokeswoman did not immediately respond to a request for comment from The Hill.

Energy Secretary Rick Perry mandated the study in April and has said its goal is to ensure the grid provides reliable electricity despite government incentives for renewable power. The draft study’s conclusions would, in a way, undercut Trump administration rhetoric about the impact of regulations and renewable power on electricity availability.

The conclusions would be a victory for renewable energy supporters, who have worried the study could serve as a pretext for a Trump administration push to support traditional fuel sources over the growing wind, solar and renewable sectors.

The draft study says that “renewables didn’t cause retirements, but they’ve exacerbated the problem,” pointing to state renewable energy standards and federal tax credits for wind and solar.

But the study also concludes that “the retirement of baseload power plants has accelerated since 2009” and that “baseload retirements correlate close to the fall in natural gas prices and the flattening of customer peak demand.”

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