PJM’s Kormos and Glazer Testify on Clean Power Plan at FERC

Michael Kormos, executive vice president of Operations for PJM, testified Feb. 19, at the Federal Energy Regulatory Commission’s technical conference on the potential implications on reliability and wholesale electricity markets of the U.S. Environmental Protection Agency’s proposed Clean Power Plan. The plan is intended to reduce carbon dioxide emissions.

In prepared remarks, Kormos pointed out that the market, itself, is a tool to ensure efficient, competitive outcomes in response to a particular set of state or federal policies.

“In some ways, the Clean Power Plan can be seen as another policy choice to which the markets will react,’ Kormos said in his testimony. “Just as with the MATS rule and state RPS rules, the EPA Clean Power Plan will adjust the type of resources that bid into the market but will not require wholesale market redesign. In this way, the markets provide an important role in revealing the least cost compliance options while also facilitating innovation by allowing new ideas to be tested and monetized if successful (or replaced if unsuccessful).”

Representing the ISO/RTO Council, Craig Glazer, vice president – Federal Government Policy for PJM, presented on a panel about the “reliability safety valve” concept, one of four mechanisms proposed by the council. The IRC represents North American regional grid operators. The safety valve is intended to preserve reliability by better managing the timing of generator retirements as a result of the Clean Power Plan. A similar approach was used with the EPA’s Mercury Air Toxics Standards.