Reliable Power Act Gives FERC Veto Power Over EPA Rules to Prevent Grid Shortages

The proposed "Reliable Power Act" is focused on one thing: making sure the lights stay on. It introduces a new mechanism designed to prioritize the stability of the power grid over certain regulatory actions being developed by other federal agencies, like the Environmental Protection Agency (EPA).

The Early Warning System: Generation Inadequacy

Right now, the Electric Reliability Organization (ERO) already assesses the health of the bulk power system. This bill amends the Federal Power Act (Section 215) to require the ERO to conduct an annual long-term assessment. Think of this as a mandatory, deep-dive stress test for the grid. The ERO has to analyze everything: the mix of power plants, transmission line development, and how electricity demand is trending. The goal is to spot potential power supply shortfalls years in advance, especially under extreme weather conditions.

If the ERO determines that the grid is at risk of not having enough resources to maintain reliability—a situation the bill calls a state of "generation inadequacy"—it must publicly notify the Federal Energy Regulatory Commission (FERC). This is the key trigger that kicks off the rest of the bill’s provisions.

FERC’s New Regulatory Review Power

Once FERC gets the “generation inadequacy” notice, it essentially gains a temporary, powerful check on other federal agencies. FERC must notify agencies like the Department of Energy and the EPA. The head of any notified agency must then submit any pending "covered agency action" to FERC for review and comment. A "covered agency action" is defined as any regulation under development that relates to or directly affects power generation resources.

For example, say the EPA is working on a new rule to limit emissions from power plants. If the ERO has declared a generation inadequacy, the EPA must hand that draft rule over to FERC. FERC, consulting with the ERO, will then review the rule and provide comments, specifically assessing if the proposed rule will negatively affect the grid's ability to supply sufficient power to maintain reliability. They can even recommend modifications to prevent a significant negative impact.

The Final Say on Rulemaking

Here’s where the rubber meets the road for anyone concerned about environmental or other federal regulations. The federal agency—let’s stick with the EPA example—cannot finalize that covered rule until two things happen. First, the agency must respond in writing to FERC, explaining how they modified the rule or why they chose not to. Second, and most importantly, FERC must find that the rule is not likely to have a "significant negative impact on the grid’s ability to supply sufficient power to maintain reliability" (Sec. 2, Agency Response and Finalization).

If you’re a small business owner relying on stable, affordable power, this bill aims to ensure that grid reliability is always part of the regulatory equation, potentially preventing future blackouts. However, if you’re concerned about clean air or water, this provision grants FERC significant, potentially subjective power to delay or block rules from other agencies. The standard of “significant negative impact” is vague, and it hands FERC—whose primary focus is economic regulation and energy markets—a near-veto over environmental or public health rules that might impose costs or restrictions on power generators, all under the banner of keeping the lights on.