Appeals Court upholds grid operator PJM’s decision on renewables and state incentives

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The  United States Court of Appeals for the Third Circuit in Philadelphia upheld a ruling from the Federal Energy Regulatory Commission that retains  rules by grid operator PJM.

The  legal battle stemmed over fossil fuel power plant operators claiming the rules  made their plants uncompetitive with renewable solar and wind projects  getting state incentives.

Caroline Reiser senior staff attorney at the Natural Resources Defense Council, said the decision “eliminates the anti-competitive treatment of resources supported by state and local policies in PJM. With this rule in place, consumers will see the full benefits of state investments in clean power. Fossil fuel interests were trying to use the courts to do something they could not do in the market – slow the clean energy transition. This order should close the door to polluters’ attempts to unfairly skew power market rules in their favor.”

The National Resources Defense Council and other environmental groups claimed that had the appeal succeeded, PJM would offer more subsidies  to fossil fuel plant operators that would freeze out renewables projects in Delaware and other states, along the way, driving up electric rates.

At the same time,   PJM has warned that fossil fuel  plants are being retired at  a faster rate than new renewable generation is coming online. 

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A little less than a year ago,  a near crisis developed when natural gas supply issues led some plants to struggle  during a cold snap.  

Coal plants can also experience problems during cold snaps without adequate preparations. Wind and solar power reportedly fared well during that period.

PJM critics have claimed it is not doing enough to handle a backlog of renewable energy projects. The grid operator has launched reforms  in an effort to separate “shovel ready” projects from tentative proposals.

Critics on both the left and right would like to see states have more power in dealing with power generation and grid issues.

In Delaware, the state’s remaining coal-fired plant near Millsboro is being temporarily subsidized under an agreement with PJM  while the grid around it is strengthened. Owner NRG had scheduled a shutdown for the plant citing an inability to compete with other forms of generation.

Meanwhile, Delaware and other states are  seeing more restrictions on placement of larger solar farms, citing the loss and farmland, zoning issues and not in my backyard opposition. Delaware  has little if any land available for onshore windfarms.

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