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How Trump did the impossible: Got solar, oil lobbyists to unite

Ari Natter and Jennifer A. Dlouhy, Bloomberg News on

Published in Political News

WASHINGTON -- In his 20 years of promoting renewable energy in Washington, Gregory Wetstone has made common cause with a range of special interest groups: environmentalists, power utilities, even a handful of natural gas producers. But President Donald Trump's efforts to bail out the coal industry led Wetstone, the head of the American Council on Renewable Energy, to find a surprising new partner: Big Oil.

Within hours of Energy Secretary Rick Perry releasing a proposal to overhaul the country's power markets to advantage unprofitable coal and nuke plants, Wetstone was busy pulling together a team of unlikely allies, including solar installers, oil refineries and natural gas drillers, all of whom were worried that the plan would raise electricity costs and undercut their fuel source in the power markets.

With uncharacteristic speed for a collection this broad, Wetstone's renewable energy council joined the American Petroleum Institute and 19 other groups to submit comments that noted their unlikely alliance, slyly noting the proposal's "power to unite." They dubbed the plan ill defined, unwarranted and unreasonable.

"It's not often that our interests align, but I think everyone recognizes the importance of standing up together," he said in an interview. "It's a reflection of how disruptive the policy put forward would be.

The lobbying is aimed at the Federal Energy Regulatory Commission, which oversees the nation's electricity markets and is set to decide by Dec. 11 whether or how to act on the Energy Department's proposal. If approved, it could help achieve Trump's goal of putting some U.S. coal miners back to work by giving unprofitable coal power plants an edge against more economical ones that run off cheap wind, solar and natural gas.

When he proposed his grid overhaul, Perry relied on an obscure statute to argue that regulators should reward coal and nuclear plants because of their ability to keep enough fuel on hand to operate in case of emergency. Perry has asked FERC to allow power plants with 90 days of fuel on site to charge customers more money. Coal and nuclear plants store their fuel at the plant; natural gas and renewables typically don't.

 

No one is really sure how much that would raise Americans' power bills. Estimates range from a few hundred million dollars to more than $200 billion.

Perry's proposal caught energy lobbyists across Washington off guard. One oil company executive described frantic emails and phone calls trying to suss out details on it the night before it was released. Energy lobbyists scrambled to prepare executives, including at least two chief executive officers for phone calls and face-to-face meetings with top Perry and FERC officials. Ben van Beurden, the chief executive of Royal Dutch Shell Plc, pressed the issue with Perry when the two crossed paths at an energy event in Paris.

"I haven't seen the U.S. gas or power industry this concerned in a long time," says Orlando Alvarez, the head of BP Energy Co.'s natural gas and power marketing and trading business. "It's getting attention of senior executives at

BP Plc and other oil companies are now big producers of natural gas, and therefore worried about bailouts to their rivals. Cheaper, cleaner-burning gas has displaced coal at power plants around the country, and now supplies more than a third of the nation's electricity.

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