Energy Secretary Rick Perry confirmed that the Trump administration is looking into using a Cold War-era law to prop up struggling U.S. coal and nuclear power plants.
Speaking to the House committee on Science, Space and Technology Wednesday, Perry named the Defense Production Act as something the Department of Energy (DOE) is “looking very closely at” as a way to secure the nation’s energy grid.
“That’s approaching this from an economic standpoint and I think … it’s about the national security of our country, of keeping our plants, all of them, online, being able to deliver energy” in an emergency, Perry told the committee.
“So, we’re looking at a number of ways to approach this. I know the Defense Production Act is one of those ways to address [it] that we’re looking at very closely as well.”
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It was reported in April that the Trump administration was considering utilizing the 68-year-old law, which was passed by Congress in the midst of the Korean War, as a way to nationalize the energy industry.
Bloomberg reported that White House aides were looking into how to best implement the policy, which gives the government broad latitude to nationalize private industry in the name of security.
The law could allow the administration to provide help to the industries in the form of loans and loan guarantees or purchase commitments. It could also be used to help specific regions or plants.
Perry’s announcement was the first confirmation that the act is strongly being considered as the administration seeks to help the coal and nuclear industries.
His comments come a day after a coalition of natural gas, renewable energy and energy efficiency groups wrote a letter to Perry telling him to reject calls to bail out FirstEnergy, which filed for bankruptcy in early April. FirstEnergy is a major utility company that provides nuclear and coal power; it sent a request to DOE in March asking Perry to intervene to keep the nuclear plants functioning.
“Power plant retirements are a normal, healthy feature of electricity markets. There is no emergency or threat to the national defense on which the Department could lawfully base the exercise of its emergency authorities,” the groups wrote in their Tuesday letter to Perry.
Sen. Joe Manchin (D-W.Va.) back in April proposed a counter opinion, sending a letter to President Trump urging him to utilize the policy in the name of homeland security. Manchin’s home state is a major coal producer.
“The security of our homeland is inextricably tied to the security of our energy supply,” Manchin wrote. “The ability to produce reliable electricity is critical to ensuring our nation’s security against the various threats facing us today — whether those threats be extreme weather events or adversarial foreign actors.”