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Study: PJM Can Handle Clean Power Plan Without “Reliability Safety Valve”

March 17, 2015

PJM is taking reasonable and appropriate steps to ensure reliability and does not need a “Reliability Safety Valve” to comply with the proposed federal Clean Power Plan, according to a study by Analysis Group energy experts. The report shows PJM is already adapting to changing market conditions that will result in compliance with the plan – which is intended to reduce the U.S. electric system’s CO2 emissions by 30 percent from 2005 levels by 2030 – as it transitions from coal-fired resources to natural gas–fired and wind projects. “PJM has effectively administered processes to manage this transition in a way that meets both reliability and efficiency objectives,” the report says. Furthermore, PJM has a variety of regional tools and resources available to address potential reliability issues associated with the retirement of power plants, changing regulations, or extreme weather conditions. The report’s authors conclude that, “Given the robustness of existing reliability tools and the flexibility in the Clean Power Plan, we are not convinced that a Reliability Safety Valve, as proposed by PJM, is either needed or practically workable.” However, they suggest that if such a mechanism is allowed, it should be regulated in a way that is appropriate, transparent, equitable, equivalent, and cost effective.

http://www.analysisgroup.com/article.aspx?id=15880