Media Release
Reliability Review of Proposed Clean Power Plan
Identifies Areas for Further Study, Makes
Recommendations for Stakeholders
November 5, 2014
ATLANTA – The North American Electric Reliability Corporation completed its
preliminary reliability review of the assumptions and potential reliability impacts of
the Environmental Protection Agency’s proposed Clean Power Plan under Section
111(d) of the Clean Air Act. This assessment – Potential Reliability Impacts of EPA’s
Proposed Clean Power Plan – examines the potential reliability aspects resulting
from its anticipated implementation. In order to continue operating the bulk power
system safely and reliably, more detailed and thorough analysis is needed to
determine whether the assumptions are feasible and consistent with the
requirements of bulk power system reliability.
This assessment provides the foundation for future reliability analyses and
evaluations required by the electric reliability organization, stakeholders and federal
and state policy makers to ensure the system maintains reliability. The goal of these
studies is to create a framework with realistic timelines that accommodate the
expected infrastructure deployments needed to support bulk power system
reliability, while achieving the environmental objectives of the proposed rule.
“The bulk power system is undergoing a fundamental transformation toward
increasing dependency on natural gas, wind and solar resources. The Clean Power
Plan substantially accelerates that shift and proposes a very different mix of power
resources than we have today,” said Gerry Cauley, president and chief executive
officer at NERC. “Our role, through our reliability assessments, is to identify
emerging reliability issues that must be adequately addressed to ensure future
reliability of the electricity supply. 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. ”
CONTACT:
Kimberly.Mielcarek@nerc.net
3353 Peachtree Road NE
Suite 600, North Tower
Atlanta, GA 30326
404-446-2560 | www.nerc.com
The Clean Power Plan, which seeks to reduce carbon dioxide emission from power plants to 30 percent
below 2005 levels by 2030, calls for states to begin submitting implementation plans as early as June 30,
2016 and regional implementation plans by June 30, 2018.
Based on projections in NERC’s 2014 Long-Term Reliability Assessment (to be released later this month),
power plant retirements and limited capacity additions are contributing to diminishing reserve margins in
New York, the Midwest and Texas. 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. Industry
projections indicate an additional 44.2 GW across the NERC footprint. By 2020, the EPA assumes that
impacts of existing environmental regulations, combined with the proposed Clean Power Plan, will reduce
coal-fired generation by up to 69.8 GW beyond NERC’s 2014 LTRA reference case projections.
“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.”
This assessment does not advocate or support any policy position or promote a specific compliance
approach; rather it provides stakeholders with an independent assessment of reliability while serving as
a platform to inform policy discussions on the reliability impacts concerning the proposed plan.
NERC will provide additional information on the proposed Clean Power Plan in the NERC 2014 Long-Term
Reliability Assessment, expected to be released this month, which provides a forward looking and
independent perspective on the adequacy of generation, demand-side resources and transmission
systems needed to maintain and enhance reliability over the next 10 years.
NERC also plans to conduct three additional assessments as the rule is finalized and implemented,
including an analysis that provides 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.
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The North American Electric Reliability Corporation (NERC) is a not-for-profit international regulatory authority whose mission is
to ensure the reliability of the bulk power system in North America. NERC develops and enforces Reliability Standards; annually
assesses seasonal and long‐term reliability; monitors the bulk power system through system awareness; and educates, trains,
and certifies industry personnel. NERC’s area of responsibility spans the continental United States, Canada, and the northern
portion of Baja California, Mexico. NERC is the electric reliability organization for North America, subject to oversight by the Federal
Energy Regulatory Commission and governmental authorities in Canada. NERC’s jurisdiction includes users, owners, and operators
of the bulk power system, which serves more than 334 million people.
Media Release | Reliability Review of Proposed Clean Power Plan Identifies Area for Further Study
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