Dive Brief:
- The North American Electric Reliability Corp. issued a report finding the electric industry needs more time in order to comply with U.S. Environmental Protection Agency carbon standards while maintaining reliability, Bloomberg reports.
- NERC said power plant retirements and limited capacity additions are contributing to diminishing reserve margins in New York, the Midwest and Texas.
- The report noted that since 2011 more than 30 GW of conventional fossil-fueled generation has been retired, primarily due to existing environmental policies and low natural gas prices.
Dive Insight:
"Based on our preliminary assessment of the proposed rule, we believe there must be further detailed engineering analysis to demonstrate whether the assumptions and targets are feasible in the timeframe proposed," said Gerry Cauley, president and CEO of NERC, according to Bloomberg.
NERC intends to provide additional information on the proposed Clean Power Plan in its NERC 2014 Long-Term Reliability Assessment, expected to be released this month. It also said it plans to conduct three additional assessments as the rule is finalized and implemented, including an analysis providing a more detailed examination of generation and transmission adequacy and reliability impacts in 2015, a comprehensive assessment of the final rule prior to the state implementation plan deadline, and an assessment that examines the final state implementation plans in 2016.
“EPA’s estimated generation retirements may be conservative if the assumptions incorporated into the building blocks in the Clean Power Plan prove to be unachievable,” said Thomas Burgess, vice president and director of Reliability Assessment and Performance Assessment at NERC. “Some areas may require significant infrastructure enhancements and industry may require additional time to ensure reliability."
