Fossil-Fuel Plant Retirement Disputes and Grid Reliability During the Energy Transition: Evidence from Eddystone and J.H. Campbell

Recent fossil-fuel plant retirement disputes show how difficult it can be to maintain grid reliability while the energy grid is undergoing so many changes. This paper focuses on two plant retirement disputes, the Eddystone/PJM and J.H. Campbell/MISO cases, and analyzes the policies associated with maintaining grid reliability during the energy transition. Throughout the analysis, it becomes evident that there is more to the conflict than a simple tradeoff between reliability and decarbonization. There is a coordination problem between many governing organizations. Plant owners, state regulators, regional grid operators, FERC, NERC, and DOE all have different responsibilities, and their decisions do not always line up. A plant owner may decide that a facility is no longer economical while another institution later argues that it is still needed for reliability. Section 202(c) of the Federal Power Act gives DOE the authority to prevent plant closures that are deemed necessary for reliability, regardless of the economics involving the plant. However, this paper argues that authority should remain a temporary response to a specific reliability problem. If DOE keeps a plant operating, it should be able to show why that plant is needed, who will pay for it, and what has to happen before it can finally retire. The Eddystone and Campbell cases suggest that repeated emergency orders are not just a reliability issue. They are also evidence that retirement decisions and replacement resources are not being coordinated well enough.