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Sanders is the front runner for the Democratic presidential nomination. What could his plan to federalize electric utilities mean for the country’s climate goals and existing power providers?

image credit: © Carolyn Franks - Dreamstime.com

Although there is plenty of time left for challengers to win the Democratic presidential nomination, early polls show Vermont Sen. Bernie Sanders as the front runner.

Health care seems to have taken over the conversation when it comes to debates over Sanders’ “electability” and his ambitious plans. However, his energy policy proposals are just as ambitious and his election could have far-reaching impacts on the country’s electricity generators and providers.

As part of his $16 trillion energy plan, Sanders wants to federalize a large portion of the country’s electricity generation, build out massive federally-owned renewable energy infrastructure and phase and squeeze out utilities that rely on fossil fuel for their electricity generation. His plan creates a competitive public option for local utilities to buy into, aiming to offer considerably cheaper renewable options and forcing fossil fuel-sourced energy providers out of the market.

The plan, which includes injecting trillions of dollars into a massive infrastructure build-out and transmission and battery storage, will add to and expand existing Power Marketing Administrations to supply energy to all 50 states and U.S. territories. The plan is focused on delivering a 100% renewable energy system by 2030, the most ambitious plan offered by any presidential candidate and one that calls for massive expansion of the federal government.

The idea of the government taking over privately-owned utilities made headlines last year after Californians pressed the government to take over PG&E following multiple deadly wildfires attributed to, among other things, poor infrastructure maintenance. Of course, the Sanders proposal focuses on a public takeover due to lack of aggression in meeting the needs of a country in climate crisis.

However, according to a Politico piece on Sanders’ proposal, the notion of federal government expansion into the energy industry has several issues. Among them is alienation of a huge voting bloc in battleground states, according to Josh Freed of the think tank, Third Way.

“I think a plan like this could turn off votes in large parts of the country,” Freed told Politico. “It would have challenges in Pennsylvania, Michigan—a lot of the states that are competitive for the election.”

Government expansion not only causes an issue, but also the federal government entering and potentially disrupting what has been a healthy renewable energy market.

Sanders’ plan also seeks to completely phase out nuclear energy and natural gas from the country’s portfolio, according to his campaign. Nuclear has lived a controversial life, but it has also seen a renaissance as of late, with even minds like Bill Gates lauding its potential. Sanders’ goal is to reject permit renewals for nuclear plants, as well as make the price of solar and wind power so cheap that nuclear cannot compete.

Natural gas and fracking, on the other hand, has never been popular with climate advocates; however, fracking under the Obama Administration was central to a 15% reduction in carbon emissions. Sanders, as a senator, vowed to eliminate fracking across the country by 2025.

At the center of all this are the utilities—the large corporations such as Dominion, Duke and Xcel who will have to compete with a public option aimed at squeezing them out of the market, and the more local distribution utilities that will have to make choices on where and how to purchase its energy with a competitive public option now in the mix.

Could this public option proposal work? Sanders claims it is the only option that gets the U.S. where it needs to be to avoid climate catastrophe by 2031.

Christopher Neely's picture

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Discussions

Hans Hyde's picture
Hans Hyde on Feb 18, 2020 3:09 pm GMT

Bernie must think he's running for governor of NY with the expectation downstate will carry him to Albany.

Voting block that wants...

- Nuclear plant closures - check

- No fracking or new more efficient combined cycle - check

- Massive build out of wind & solar (but NIMBY only) - check

- Massive build out of new transmission - Not In My Back Yard (or anyone's backyard)

The first 3 are a very narrow, small voting block.  The 4th is a much larger block of centrist &/or independents, which the first 3 policies would alienate.

The only "federalization" from a climate change/action perspective that would have made sense the past decade would have been the federalization of the US nuclear fleet (as flawed as they may be) were closed for "economic" reasons - and Bernie wants to close them all?!

Our country still has a massive coal fleet to shutter.  The largest buildout of new transmission since Rural Electrification has occured in the past decade by Investor Owned Companies/Utilities, not TVA, BPA, SRP or WAPA.  The largest buildout of wind & solar has also hapened through the private markets, not the Federal Marketers - whom clearly could use a kick in the a$$.

Unfortunately, naracism nor ego, are life shortening ailments.

Bob Meinetz's picture
Bob Meinetz on Feb 24, 2020 2:27 am GMT

"Sanders’ goal is to reject permit renewals for nuclear plants, as well as make the price of solar and wind power so cheap that nuclear cannot compete."

Christopher, there seem to be a couple of memes being dicussed in energy circles with no relationship to anything that actually happens in the business of making electricity.

First of all is the idea renewables, alone, will ever "compete" with nuclear. This apples-to-pomegranates comparison ignores some important facts about renewables:

  1. Unlike nuclear, they can't provide a reliable supply of electricity on their own.
  2. Unlike nuclear,  they require backup from natural gas, and the emissions from burning that gas comes along with it. Package deal.

Second is the idea a competitive market in electricity even exists:

  1. The public cannot freely choose what their sources of electricity are, or even know for sure what they are now. That's handled by regional system operators (RSOs), who are in charge of dispatching electricity resources as necessary so that everyone gets a reliable supply. If two resources are available, renewables typically must be first in the loading order mandated by state utility commissions. Whether you want them or not. Whether they cost more, or not.
  2. It's not up to the President to approve or reject permit renewals for nuclear plants - that's handled by the qualified nuclear engineers and physicists at the Nuclear Regulatory Commission. Sure, the President could stack the deck with toadies on the NRC who know nothing about energy, and take the ideological, anti-science path Trump has paved. But then, why vote for Sanders?

Neither of the above conditions can exist in a competitive marketplace. If sources of electricity were truly competitive with each other, not a President Sanders nor anyone else could "make" one source of energy cheaper than another. That's the point of competition, isn't it - to allow the decisions of consumers to set the prices of goods or services, not some ideological politician?

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