FERC Must Act to Ensure the Climate Resilience of the Bulk Power System

By Romany Webb

On January 8, 2018, the Federal Energy Regulatory Commission (FERC) initiated a proceeding to “evaluate the resilience of the bulk power system” in areas overseen by Regional Transmission Organizations and Independent System Operators (RTO/ISOs). As part of the proceeding, RTO/ISOs were asked to provide information on “the primary risks to resilience in [their] region,” and “how [they] identify and plan for those risks.” Their responses, filed with FERC in early March, offer a glimpse into what RTO/ISOs see as the most pressing threats to their systems. For some – most  notably the New England ISO – it’s clearly the potential for fuel supply disruptions. Others – such as the Midcontinent ISO – seem more concerned about the risk of cyber and physical attack. None, however, are focused on the threats posed by climate change. That is a significant oversight which leaves RTO/ISOs ill-equipped to deal with the impacts of climate change and thus threatens the resilience of the bulk powers system.

Recognizing this, in a letter filed with FERC today, the Sabin Center calls for action to ensure that RTO/ISOs adequately plan for the impacts of climate change. The letter draws on a recent Sabin Center white paper discussing the potential for climate change impacts to disrupt operation of the bulk power system, for example, by forcing generating facilities to curtail output or shutdown and leading to widespread transmission outages. As explained in the letter, while climate change-related disruptions are likely to be experienced in all RTO/ISO regions, they have been largely ignored in RTO/ISO planning. No RTO/ISO has, to our knowledge, undertaken a comprehensive assessment of how climate change will affect their system or developed a plan for managing those effects.

To address this deficiency in RTO/ISO planning, FERC should convene a technical conference to explore the risks posed by climate change, and how best to plan for those risks. FERC should also consider initiating a rulemaking or other appropriate proceeding to develop standards for climate change planning. This is, in our view, necessary to fulfil FERC’s statutory duty to ensure the bulk power system delivers reliable electricity services at just and reasonable rates. To achieve that goal, the bulk power system must be able to withstand and recover from climate change-related disruptions, which will only be possible if RTO/ISOs plan effectively. Planning is also required to ensure that RTO/ISO-operated markets account for the risks posed by climate change and thus provide appropriate incentives for investment in new facilities capable reliably delivering electricity. Hopefully FERC will remember that as it explores options to enhance the reliability and resilience of the bulk power system.

Click here to read our letter to FERC in full. Further information about FERC’s resilience proceeding is available here.

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