Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Nuclear Crisis Firstenergy Executive Says Policies Harm Energy Market

Newspaper article Pittsburgh Post-Gazette (Pittsburgh, PA)

Nuclear Crisis Firstenergy Executive Says Policies Harm Energy Market

Article excerpt

WASHINGTON - In Donald Moul's view, the competitive energy market in Pennsylvania isn't broken. But the rules that govern it are distorting FirstEnergy's ability to compete.

Mr. Moul, vice president of commodity operations for FirstEnergy Solutions, said as much on Tuesday to a room full of nuclear operators, analysts and regulators gathered for the Platts 11th Annual Nuclear Energy Conference in Washington, D.C. He places the blame not on normal market functions, he said, but on policy decisions that have eaten away at the value of its coal and nuclear fleet.

"We don't really have a completely deregulated market," he said. "We just have a different kind of market."

At issue is how so-called base load power generation is included - or not included - in the implementation of clean energy policies. Base load power, manifested in nuclear and coal power plants, runs year-round regardless of demand and is most profitable during peaks. Nuclear advocates on Tuesday pointed to the role of base load power in ensuring reliability during the polar vortex last winter, which strained natural gas supplies as demand spiked.

But nuclear power, Mr. Moul said, has been left behind as incentives and subsidies for clean energy have created an unfair advantage.

"Our vital base load generation is at risk, due to a greater reliance on subsidized, intermittent renewables," Mr. Moul said, calling the wind production tax credit "murderous for a nuclear plant" in competitive markets.

FirstEnergy has plenty at stake. About 57 percent of the company's total generation comes from coal, and another 23 percent comes from nuclear. It operates four nuclear units - two in Ohio, and two at the Beaver Valley Power Station near Shippingport.

Last summer, the company asked the Federal Energy Regulatory Commission to help make their coal and nuclear plants more competitive in regional auctions that set the price for capacity payments, or charges paid to an electric supplier for agreeing to meet a portion of expected demand.

The company is peeved by the auction's valuation of demand response - the process by which consumers agree to cut back during times of peak demand - by PJM Interconnection, the regional grid operator tasked by the federal government with ensuring reliability in 13 states and the District of Columbia. …

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