Murkowski: FERC Responsible for Protecting Power Grid Reliability

FERC’s Unwillingness to Fully Analyze Possible Impact on Reliability Is Unacceptable

WASHINGTON, D.C. – U.S. Sen. Lisa Murkowski, R-Alaska, today called on the Federal Energy Regulatory Commission (FERC) to immediately initiate a formal process to address electricity reliability issues raised by the Environmental Protection Agency’s regulatory agenda.

In a letter to FERC Chairman Jon Wellinghoff, Murkowski requested the commission provide, within six months, a thorough analysis of the cumulative impact that proposed EPA regulations could have on the reliability of the nation’s power grid. Murkowski mentioned the Utility MACT and Cross State Air Pollution rules specifically as being of concern, and said FERC should conduct its analysis in concert with the North American Electric Reliability Corporation (NERC) and the Electric Reliability Organization it has certified.

“The pace and aggressiveness of these environmental regulations should be adjusted to reflect and consider the overall risk to the bulk power system,” Murkowski said, quoting NERC’s 2010 Special Reliability Scenario Assessment. “The regional nature of the nation’s power system does not allow for the seamless transfer of power from any point in the country to any other, which means power outages could occur in a particular region even though excess generation exists elsewhere.”

In her letter, Murkowski commented on Chairman Wellinghoff’s apparent disregard, both in his August 1 correspondence with the senator and in his September 14 testimony before the House Energy and Commerce Committee, for the cumulative impacts EPA rulemaking could have on the reliability of the nation’s power grid through the closure of existing power plants as a result of the rules.  

“I was taken aback by your acknowledgement that despite FERC projections that EPA’s current regulatory agenda would cause widespread retirement of electric generating capacity, the commission has neither undertaken nor ordered any further study of the issue,” Murkowski said.

Murkowski said it was FERC’s statutory responsibility under the Federal Power Act to oversee the reliability and security of the nation’s bulk power system.

“A ‘wait-and-see’ approach with regard to the impact of these major federal rulemakings is both unacceptable and explicitly contrary to one of the commission’s central obligations,” Murkowski said. “Congress, the executive agencies, and the public should be informed of the risks. And the commission should take every measure within its power to protect the reliability and security of the nation’s bulk power system.”

Among the questions Murkowski is asking FERC to address:

  • Which generating facilities are likely to retire as a result of the EPA rulemaking agenda in general or the Utility MACT and Cross State Air Pollution rules in particular?
  • How will such retirements affect the bulk power system?
  • Whether such retirements would diminish reliability in particular markets and, if so, which markets?
  • Whether existing or planned transmission facilities will be adequate to accommodate increased demand as a result of the retirements?
  • What, if anything, the commission should do to maintain the reliability and security of the nation’s bulk power system?

 “We must consider the total impact that each rule – and all rules in combination with one another – will have on the electric grid,” Murkowski said. “The reliability of the grid has a direct impact on the quality and cost of electricity, which in turn affects Americans’ ability to affordably power and heat their homes.”   


In May, Murkowski asked FERC to explain what steps the commission was taking to ensure EPA’s new regulations would not adversely affect reliability. FERC’s responses were delivered in August along with a number of FERC documents, including a presentation that shows that at least as early as October 2010, the commission’s staff presented EPA and the Council on Environmental Quality its preliminary conclusions about potential power plant retirements as a result of the EPA’s various pending rulemakings. In testimony last week before the House Energy and Commerce Committee, FERC Chairman Wellinghoff said he was not concerned about the impact on reliability.

Murkowski also recently wrote EPA Administrator Lisa Jackson asking the agency to defer implementation of stricter federal regulation of power plants until a full impact analysis can be completed.