FERC will initiate an investigation on ways to ensure power reliability in the face of climate change and its possible threat to the grid; it will also analyze if, in the wake of the Texas freezing storm, there was a market manipulation to artificially boost prices, the commission said this Monday.
Firstly, FERC’s chairman, Richard Glick, said in the statement: “the effects of climate change are already apparent; we must do everything we can within our statutory authority to ensure that the electric grid is capable of keeping the lights on in the face of extreme weather.”
Secondly, FERC remarked that the proceeding will examine how grid operators prepare for and respond to extreme weather events; including extreme cold, wildfires, hurricanes and heat waves.
Indeed, extreme cold is not the only way in which the grid could be crashed. Last August, in California, a crushing heat wave provoked a series of blackouts for two days. In addition, about a decade ago, Texas had also a milder cold wave.
Back then, FERC assessed ways to ensure the reliability of the grid, however, as time went by, further modernization of the grid didn’t happen. In regards to this, FERC’s Cheryl LaFleur said to Reuters.
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FERC will investigate a potential market manipulation to artificially boost prices
“We followed up on those for a couple of years, but actual implementation was in the hands primarily of the Texas authorities who run the grid; as memories faded most of those steps were not taken.”
Moreover, LaFleur underlined that, since the present cold wave killed at least 24 people, firmer measures are needed. On the other hand, she also said that the commission will examine of wholesale prices of natural gas and electricity could be artificially boosted.
In addition, on Saturday, Senator Tina Smith wrote to FERC calling them to start an investigation upon the matter; as the increase was more than a hundred times the usual price. According to Reuters, it sparked memories of the California’s energy crisis of 2000-2001; when Enron and other companies boosted prices artificially.
Finally, FERC may work with other federal agencies to identify if there was any anticompetitive behavior.