Federal Power Act

But that doesn't mean total independence.

They have to be prepared to synchronize with the grid at times, which is a major I will point out that during the 2006 winter storms, data centers did provide backup power to certain grids under Section 202 of the Federal Power Act.

But there have also been cases where data centers went offline but then came online very abruptly and certain segments of the grid were tripped.

Yep.

And They will all eventually agree to this, but it's not their top priority.

And the rate structure and the tariff will be debated for a long time at FERC and in state PUCs.

Now, in the meantime, you've seen Energy Secretary Wright in the current administration news, uh, federal power act section two Oh two authority to tell certain power plants, you will run during this high load situation.

And, uh, not all of the power plant operators or owners like that.

[ding] Climate defenders celebrated after a federal appellate court rejected the U.S. Department of Energy's abuse of emergency powers to keep a Michigan coal plant open, part of Donald Trump's broader push to boost the climate-wrecking industry.

The court rejected the Trump administration's nationwide push, forcing unreliable, aging coal plants that are bleeding money and polluting communities to stay online, said Ted Kelly, director and lead counsel for U.S. Clean Energy at the Environmental Defense Fund, which was among the advocacy groups that joined Michigan, Minnesota, and Illinois in challenging the DOE's abuse of Section 202(c) of the Federal Power Act to keep the J.H. Campbell Generating Plant running.

"The Department of Energy's unlawful actions attempted to make families and businesses in the Midwest wastefully pay hundreds of millions of dollars for a coal plant that should have been shut down over a year ago," said Kelly.

"That's why these aging coal plants are scheduled to retire in the first place.

Well, that certainly highlights the fragility of some of our infrastructure.

Now, moving forward here, the Washington DC court ruled on 11 September that the Trump administration does not have the authority under the Federal Power Act to issue emergency orders keeping fossil fuel power plants running.

Now, Harvard Law School Electricity Law Initiative Director Ari Pesco said the Trump administration will likely lose lawsuits against the emergency orders to keep fossil fuel power plants open.

The quote, quote, the question is how quickly this happens, Pesco added.

DOE Secretary Chris Wright has been using these letters to keep these especially coal power plants but some oil-fired power plants as well open past their planned retirement date.

And many of these retirement dates were set during the Biden administration when they were trying to implement Clean Power Plan 2.0. there there's really kind of two uh situations have two ways to look at the looming electricity crisis there's a short-term problem and a long-term problem in the short term it's these retiring power plants it is the the lack or the need for infrastructure updates while these data centers are growing while the number of data centers are growing and there's the long-term issue of base load power generation I think still in the long term, after we talked the other week about the advancement of MMRs, SMRs, and some of the other projects the Trump administration is investing in, especially on nuclear, I think the long-term picture is starting to look better.

But this is bad news for the looming electricity supply crisis in the short term because we're – with the retirement of these power plants, especially if PESCO is correct that the courts are going to start finding against the Trump administration under the Federal Power Act – In the short term, this is bad because we're going to start losing more of these fossil fuel power plants that the Trump administration has been basically playing whack-a-mole to keep open.

And the next lawsuit with a court date is the 21st of October in Washington, and this is going to be a similar case over Federal Power Act emergency order.

Yeah.

So Section 205 refers to basically the section with the same name of the Federal Power Act, which is kind of the major piece of congressional legislation that governs how the power grid is regulated.

Under the Federal Power Act, electricity rates have to be what are called just and reasonable.

And utilities... are under Section 205, are supposed to file these documents, okay, with the Federal Energy Regulatory Commission that basically outline their practices and demonstrate how they will lead to rates that are just and reasonable.

Okay, so that is the Section 205 filing.

And so in PJM specifically, those rights are also, they're kind of divided up between the board and the members.

And so the board basically has Section 205 filing rights over basically anything that is contained in a document called PJM's tariff.

The tariff is essentially, I mean, it's a document that describes how PJM is going to provide the services that are essentially required of it, right, under FERC regulation and the Federal Power Act.

The court rejected the Trump administration's nationwide push, forcing unreliable, aging coal plants that are bleeding money and polluting communities to stay online, said Ted Kelly, director and lead counsel for U.S. Clean Energy at the Environmental Defense Fund.

which was among the advocacy groups that joined Michigan, Minnesota, and Illinois in challenging the DOE's abuse of Section 202C of the Federal Power Act to keep the J.H. Campbell generating plant running.

The Department of Energy's unlawful actions attempted to make families and businesses in the Midwest wastefully pay hundreds of millions of dollars for a coal plant that should have been shut down over a year ago, said Kelly.

That's why these aging coal plants are scheduled to retire in the first place.

We've talked about this over the last year.

They've been using the Federal Power Act to try to stop these fossil fuel power plants from retiring.

They have been being sued over some of those Federal Power Act letters.

Now, the U.S. is still facing a looming electricity crisis, but I think this is a positive indicator for long-term improvement combined with these other moves the Trump administration is making on especially SMRs and MMRs.

And the major obstacle to that is, especially to these necessary infrastructure improvements, are the supply chain bottlenecks for bulk power systems, especially transformers, because we have – Only a single domestic source that's – I'm sorry.

...

I have ranted on this podcast about the how the Federal Power Act of the 1930s, I mean, come on, we're still regulating electricity with a 1930 act.

Mm-hmm.

Um, that it created an artificial barrier between the, the wholesale market that FERC regulates and the state markets that the states regulate.

A U.S. Court of Appeals on Friday threw out an order from the U.S. Department of Energy that had forced a Michigan coal plant to remain open beyond its 2025 planned retirement.

The ruling found that the department had exceeded its authority under the Federal Power Act when it invoked a provision normally reserved for natural disasters.

Coal-fired power is among the largest sources of carbon dioxide emissions that contribute to climate change.

Nicola Groom reports for Reuters.