Higher power costs energize bailout fight
Perry says his department doesn’t yet have an estimate for how much extra it will cost to bolster struggling coal and nuclear plants
WASHINGTON — Lobbyists representing companies as diverse as Apple and Exxon Mobil have railed for months against President Donald Trump’s call to bail out struggling coal and nuclear plants as likely to drive up U.S. power costs.
The question now is by how much, as Energy Secretary Rick Perry says his agency is assessing the economics of raising wholesale power prices for coal and nuclear plants.
“We don’t have a dollar estimate at this particular point in time,” he said last week during an appearance at the World Gas Conference in Washington, according to the energy information service Platts.
The move is the latest development in the Trump administration’s effort to throw a lifeline to the coal sector, which has struggled to keep pace with the glut of cheap natural gas flowing from shale fields in Texas and other states, as well as advancing solar and wind energy technology.
Trump recently told Perry to “prepare immediate steps” to protect the coal and nuclear power sector, following the leak of a Department of Energy memo calling for the administration to order power grid operators to buy electricity from a list of struggling plants for two years or risk possible blackouts.
Among those pressuring the administration to take action is Bob Murray, a donor to both Trump and Perry’s presidential campaigns and the CEO of one of the country’s largest coal min-
ing companies in Murray Energy. But in aiding the coal sector, the administration risks alienating some of the president’s allies in the oil and gas industry, which competes with coal in fueling the power sector, and the business community at large, which would likely face larger electricity bills.
How seriously the administration will take the cost assessment remains unclear, as Perry has repeatedly described the ongoing power plant closures as a national security matter that rises above costs that businesses and consumers might have to pay.
“The economics is secondary from my perspective,” he said, during recent meeting with reporters in Washington. “You have the potential to have some really chaotic events in the country. That is the Department of Energy’s responsibility to make sure that does not happen. I look at this not unlike the decisions that get made” at the Department of Defense.
That take has angered many Republicans, who worry Perry is doing the very thing he railed against as governor of Texas, using federal powers to favor one sector of the energy industry over another.
“We urge you to continue your efforts to reduce harmful government interference in the sector by rejecting unwarranted bailouts of energy companies under the guise of national security concerns,” a coalition that includes Americans for Tax Reform and Taxpayers for Common Sense wrote in a letter to Perry.