Press Releases
02/22/2022
Connecticut Leads Multistate Comments to FERC Urging Ratepayer Protections, Clean Energy Goals in Reactive Power Market Design
(Hartford, CT) – Attorney General William Tong, Commissioner Katherine S. Dykes, and Acting Consumer Counsel Claire E. Coleman today led a coalition of attorneys general and public advocates from nine states and Washington, D.C. in submitting comments to the Federal Energy Regulatory Commission urging adoption of environmental justice and ratepayer protections and clean energy policies in reactive power market design.
On November 18, 2021, FERC published a Notice of Inquiry in Docket No. RM22-2 entitled “Reactive Power Capability Compensation” as a step to changing the rules by which electric power generators are paid to provide reactive power. Reactive power is the form of electric power used to move electricity through the grid and is necessary for grid operation. The 2003 Blackout was caused by insufficient reactive power and cost ratepayers $30 billion in losses. The multistate coalition urges FERC to focus on the fundamental need to protect ratepayers from unjust and unreasonable costs and risks and to ensure that any changes in compensation structures for reactive power are not inconsistent with state clean energy policies and goals. The comments urge the Commission to address the fact that many of the resources used to provide reactive power are located in traditionally underserved and overburdened communities. The needs of these communities must be respected and properly addressed in any new market design.
“Most of us do not know what reactive power is, but we know what happens when we don’t have it—blackouts. This critical energy source has historically come from dirty fossil fuel plants located in overburdened and underserved areas, which today are primarily communities of color. FERC is right to focus on this issue, and their leadership will be necessary to ensuring a cleaner and more affordable energy future,” said Attorney General Tong.
“An effective and equitable path for decarbonizing our electric grid requires us to consider how we can secure needed reactive power in the future, in a way that does not disproportionately burden environmental justice communities,” DEEP Commissioner Katie Dykes said. “I am proud to participate in these multistate comments calling on FERC to ensure that the concerns of environmental justice communities are properly considered and addressed in this process."
"Connecticut ratepayers should be heartened that FERC is examining this critical energy justice issue," said Interim Consumer Counsel Claire E. Coleman. "A fresh assessment of reactive power will ensure that customers are protected from blackouts while helping to ensure that our clean energy future benefits all consumers equitably."
The multistate coalition urges FERC to consider three basic principles outlined below.
Ensure that consumer interests are protected: Reactive power is necessary to keep the grid reliable, but it is also expensive. In 2019, ratepayers paid approximately $40 billion in transmission costs. Any reforms to the compensation metrics for reactive power must ensure that ratepayers are protected from excessive costs.
Accommodate state clean energy policy interests and targets: Reactive power compensation reform must be designed in a way that does not simply provide additional compensation to fossil fuel generation and encourage older and dirtier generators to stay on to collect reactive power compensation windfalls. Generator manufacturers are capable of repurposing fossil generation equipment to provide reactive power without use of fossil-fuel burners, an option that would support state clean energy goals and reduce cost.
Ensure that interests of overburdened communities be identified, respected, and accommodated: Much of the nation’s energy infrastructure has historically been sited and constructed in communities that are majority people of color and low-income. Residents in these areas suffer negative health consequences from pollution and blight that impedes participation in day-to-day activities and healthy use of community spaces. The clean energy transition that is just beginning is an opportunity to acknowledge and correct this historic discrimination. The multistate comments note that peaker power plants in particular have exacerbated air pollution in low-income neighborhoods and communities of color. Repurposing such fossil peaker plants as clean reactive power, with the opportunity for revenue sharing with local communities, is worth consideration.
The letter was signed by the attorneys general of Connecticut, Massachusetts, Rhode Island, Delaware, Michigan, Minnesota, and Oregon, as well as the Connecticut Department of Energy and Environmental Protection, the Connecticut Consumer Counsel, Delaware Office of the Public Advocate, Maine Office of the Public Advocate, and Washington D.C. Office of the People’s Counsel.
- Twitter: @AGWilliamTong
- Facebook: CT Attorney General
Media Contact:
Elizabeth Benton
elizabeth.benton@ct.gov
Consumer Inquiries:
860-808-5318
attorney.general@ct.gov