Reliability v. Health: Neighboring States Battle over Dirty but Needed Generator

A cross-Potomac skirmish over the competing principles of energy reliability and public health has broken out over the fate of Mirant Potomac River's 482-MW, coal-fired power plant in Alexandria, Virginia.  The District of Columbia Public Service Commission's ("DCPSC") petition to FERC and the Department of Energy ("DOE") to prevent Mirant from shutting down both provoked urgent protests and drew support from regional stakeholders.  

Prompting the DCPSC's petition was Mirant's announcement that, because of a Virginia Department of Environmental Quality ("VDEQ") directive to remedy air quality violations, it would shut down the plant on August 24.  In its petition, the DCPSC argued that the proposed shutdown, which Mirant has implemented, would have a "drastic and potentially immediate effect" on electric reliability in the greater Washington, D.C. area, possibly leading to curtailments of electric service, load shedding and blackouts.  The DCPSC asked the DOE to mandate continued operation of the plant pursuant to its authority under section 202(c) of the FPA, a statutory provision that was put in play during the 2000-2001 California crisis and the August 2003 Northeast blackout, and asked FERC to take complimentary actions under the FPA.

Supporters of the DCPSC petition include PEPCO, the Pennsylvania Public Utility Commission, and the PJM Interconnection.  In its comments, PJM contended that the shutdown was not consistent with its rules for plant deactivation and did not give PJM an opportunity to consider the effect of the shutdown on system reliability.   Not surprisingly, Mirant asked that any order in response to the DCPSC petition requiring it to resume operations should specify that such order preempts the authority of the VDEQ and any other federal and state environmental requirements. 

Anticipating Mirant's request for preemption, the City of Alexandria, which opposes as premature the emergency request made by the DCPSC, pointed out that Mirant's action to shut down the plant was unilateral, mandated by neither Virginia nor Alexandria.  Alexandria stated that it while it welcomed Mirant's action as appropriate in light of the environmental concerns, DOE and FERC should consider Mirant's corporate motives and agenda, and suggested that this was "a wholly manufactured scenario by Mirant to allow it to diminish its public and contractual obligations" by operating in violation of its air permit.

The VDEQ asked that any federal order to resume plant operations should consider the impacts thereof on air quality in Virginia.  The Southern Environmental Law Center, a nonprofit group, argued for rejection of the DCPSC request on the grounds that the plant's shutdown had been expected for years and was in response to "gross violations" of federal and state clean air laws that precluded a finding this was an emergency under section 202(c).