Energy & Environment

FERC Shuts Down Trump's Coal Cronyism

How an independent regulatory agency is supposed to work



The Federal Energy Regulatory Commission has rejected the Trump administration's cronyist proposal to require electric power generation plants to stockpile 90 days of coal or nuclear fuel on site. As I reported earlier:

In October, Secretary of Energy Rick Perry urged the Federal Energy Regulatory Commission to pour funds into conventional coal-fired and nuclear electricity generation plants. Perry argued the government needs to prop up these money losers in order to stabilize the power grid. As R Street Institute energy analyst William Murray points out, this amounts to a "creative" ploy "to fulfill promises made directly by President Donald Trump to coal mine owners during the election campaign, even at the cost of free markets—a supposed core belief among Republicans and conservatives of all stripes."

The requirement was artfully framed as a measure to increase power grid resilience, but it was really designed as a stealth subsidy to the coal industry. The five commissioners—four of them appointed by Trump—unanimously voted against the proposal.

This is an excellent example of an independent regulatory agency resisting political pressure, and it's good news for consumers, who now won't be charged extra for the unneeded fuel.

Disclosure: In the 1980s, I was employed as an economist for FERC. The experience turned my intellectual disdain for bureaucracy into white hot hatred.