In Austin, Energy Secretary Perry Pushes For Coal And Nuclear Bailout

Energy Secretary Rick Perry spoke in Austin this week about a new Department of Energy plan to bail out failing coal and nuclear power plants in the name of national security.

By Mose Buchele, KUT News

The former Texas governor said these plants keep their fuel on-site, making them more resilient in the event of an attack or natural disaster.

“The president is right to view grid resilience as a serious national security issue,” Perry told attendees at the Department of Energy conference on cybersecurity. “And he’s directed me to prepare immediate steps to stop the loss of these critical resources.”

Since taking over the federal agency, Perry has been trying to find ways to subsidize coal and nuclear plants, long in decline in the face of competition from cheap natural gas and renewable energy.

His first proposal was rejected by the Federal Energy Regulatory Commission. The new plan, laid out in a draft memo leaked last week, cites national security laws to argue that the president can force grid operators to buy power from coal and nuclear plants, extending a lifeline at the expense of ratepayers.

The coal industry has pushed the idea, but it’s difficult to find other groups that think the government should protect coal power.

In the last few days, an unusual coalition of grid operators, environmentalists, and oil, gas and renewable-energy companies have all come out against the plan.

Opponents point out that subsidizing coal could cost the public more than $10 billion a year, and there’s little evidence it has a security benefit.

“The problem is there isn’t a study that shows [coal and nuclear power] is incredibly valuable,” Severin Borenstein, who studies energy at UC Berkeley’s Haas School of Business, told KUT last year. “In fact, the earlier version of the Department of Energy study of resiliency … actually said it wasn’t incredibly valuable.”

While Perry said he will prepare “immediate steps” to bail out coal power, it’s unclear what those steps would be.

Groups opposed to the plan have already threatened lawsuits to stop it.

The Electric Reliability Council of Texas, which operates most of the state’s grid, said it will review the proposal’s potential impacts to the electricity market once it receives an official copy.

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