[House Hearing, 118 Congress]
[From the U.S. Government Publishing Office]





                          THE POWER STRUGGLE: 
                       EXAMINING THE RELIABILITY 
                       AND SECURITY OF AMERICA'S 
                            ELECTRICAL GRID 

=======================================================================

                                HEARING

                               BEFORE THE

 SUBCOMMITTEE ON ECONOMIC GROWTH, ENERGY POLICY, AND REGULATORY AFFAIRS

                                 OF THE

               COMMITTEE ON OVERSIGHT AND ACCOUNTABILITY

                      U.S.HOUSE OF REPRESENTATIVES

                    ONE HUNDRED EIGHTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 12, 2024

                               __________

                           Serial No. 118-93

                               __________

  Printed for the use of the Committee on Oversight and Accountability 
  
  
  
  
      [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
  


                       Available on: govinfo.gov,
                         oversight.house.gov or
                             docs.house.gov
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                 U.S. GOVERNMENT PUBLISHING OFFICE 
                 
55-180 PDF                   WASHINGTON : 2024 
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
                             
               COMMITTEE ON OVERSIGHT AND ACCOUNTABILITY

                    JAMES COMER, Kentucky, Chairman

Jim Jordan, Ohio                     Jamie Raskin, Maryland, Ranking 
Mike Turner, Ohio                        Minority Member
Paul Gosar, Arizona                  Eleanor Holmes Norton, District of 
Virginia Foxx, North Carolina            Columbia
Glenn Grothman, Wisconsin            Stephen F. Lynch, Massachusetts
Michael Cloud, Texas                 Gerald E. Connolly, Virginia
Gary Palmer, Alabama                 Raja Krishnamoorthi, Illinois
Clay Higgins, Louisiana              Ro Khanna, California
Pete Sessions, Texas                 Kweisi Mfume, Maryland
Andy Biggs, Arizona                  Alexandria Ocasio-Cortez, New York
Nancy Mace, South Carolina           Katie Porter, California
Jake LaTurner, Kansas                Cori Bush, Missouri
Pat Fallon, Texas                    Shontel Brown, Ohio
Byron Donalds, Florida               Melanie Stansbury, New Mexico
Scott Perry, Pennsylvania            Robert Garcia, California
William Timmons, South Carolina      Maxwell Frost, Florida
Tim Burchett, Tennessee              Summer Lee, Pennsylvania
Marjorie Taylor Greene, Georgia      Greg Casar, Texas
Lisa McClain, Michigan               Jasmine Crockett, Texas
Lauren Boebert, Colorado             Dan Goldman, New York
Russell Fry, South Carolina          Jared Moskowitz, Florida
Anna Paulina Luna, Florida           Rashida Tlaib, Michigan
Nick Langworthy, New York            Ayanna Pressley, Massachusetts
Eric Burlison, Missouri
Mike Waltz, Florida

                                 ------                                

                       Mark Marin, Staff Director
       Jessica Donlon, Deputy Staff Director and General Counsel
                Jeanne Kuehl, Senior Professional Staff
                Kim Waskowsky, Professional Staff Member
      Mallory Cogar, Deputy Director of Operations and Chief Clerk

                      Contact Number: 202-225-5074

                  Julie Tagen, Minority Staff Director
                      Contact Number: 202-225-5051
                                 ------                                

 Subcommittee On Economic Growth, Energy Policy, And Regulatory Affairs

                      Pat Fallon, Texas, Chairman
Byron Donalds, Florida               Cori Bush, Missouri, Ranking 
Scott Perry, Pennsylvania                Minority Member
Lisa McClain, Michigan               Shontel Brown, Ohio
Lauren Boebert, Colorado             Melanie Stansbury, New Mexico
Russell Fry, South Carolina          Eleanor Holmes Norton, District of 
Anna Paulina Luna, Florida               Columbia
Nick Langworthy, New York            Raja Krishnamoorthi, Illinois
Mike Waltz, Florida                  Ro Khanna, California
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                         C  O  N  T  E  N  T  S

                              ----------                              
                                                                   Page

Hearing held on March 12, 2024...................................     1

                               Witnesses

                              ----------                              
James P. Danly, Partner, Energy Regulation, Skadden, Arps, Slate, 
  Meagher & Flom LLP and Affiliates
Oral Statement...................................................     5
Travis Fisher, Director of Energy and Environmental Policy 
  Studies, Cato Institute
Oral Statement...................................................     6
Jonathon Monken (Minority Witness), Principal, Converge 
  Strategies
Oral Statement...................................................     8

 Opening statements and the prepared statements for the witnesses 
  are available in the U.S. House of Representatives Repository 
  at: docs.house.gov.

                           Index of Documents

                              ----------                              

  * Article, Wall Street Journal, ``EPA and Its Biden 
  Administration Critics''; submitted by Chairman Comer.

  * Article, Houston Chronicle, ``TX had most power outages in 
  five years''; submitted by Rep. Casar.

  * Article, New York Times, ``Plug In Renewables''; submitted by 
  Rep. Donalds.

  * Letter, December 20, 2023, to Administrator Regan from FERC; 
  submitted by Rep. Fallon.

  * Letter, August 8, 2023, to Administrator Regan from FERC; 
  submitted by Rep. Fallon.

  * Letter, November 8, 2023, to Barrasso and Capito from FERC; 
  submitted by Rep. Fallon.

  * Report, FERC, ``Winter-Storm Elliot''; submitted by Rep. 
  Langworthy.

  * Questions for the Record: to Mr. Danly; submitted by Chairman 
  Comer.

  * Questions for the Record: to Mr. Danly; submitted by Rep. 
  Fallon.

  * Questions for the Record: to Mr. Danly; submitted by Rep. 
  Perry.

  * Questions for the Record: to Mr. Danly; submitted by Rep. 
  Langworthy.

  * Questions for the Record: to Mr. Danly; submitted by Rep. 
  Waltz.

  * Questions for the Record: to Mr. Fisher; submitted by 
  Chairman Comer.

  * Questions for the Record: to Mr. Fisher; submitted by Rep. 
  Fallon.

  * Questions for the Record: to Mr. Fisher; submitted by Rep. 
  Perry.

  * Questions for the Record: to Mr. Fisher; submitted by Rep. 
  Waltz.

The documents listed above are available at: docs.house.gov.

 
                          THE POWER STRUGGLE: 
                       EXAMINING THE RELIABILITY 
                       AND SECURITY OF AMERICA'S 
                            ELECTRICAL GRID 

                              ----------                              


                    Tuesday, March 12, 2024

                     U.S. House of Representatives

               Committee on Oversight and Accountability

                Subcommittee on Economic Growth, Energy 
                     Policy, and Regulatory Affairs

                                           Washington, D.C.

    The Subcommittee met, pursuant to notice, at 10:04 a.m., in 
room 2154, Rayburn House Office Building, Hon. Pat Fallon 
[Chairman of the Subcommittee] presiding.
    Present: Representatives Fallon, Donalds, Bush, Brown, 
Stansbury, and Norton.
    Also present: Representative Casar.
    Mr. Fallon. This hearing of the Subcommittee of Economic 
Growth, Energy Policy, and Regulatory Affairs will come to 
order. I want to welcome everyone for coming today and thank 
you for your time. Without objection, the Chair may declare a 
recess at any time. I recognize myself for the purpose of 
making an opening statement.
    Today's hearing focuses on an issue that is critical, of 
course, to all Americans, and that is the reliability and 
security of our Nation's power grid. When we flip on the 
switch, plug in your phone charger, or put groceries in the 
fridge, you expect electricity will be flowing. In fact, we 
take it for granted.
    When I was in the military, I remember horror stories of 
fellow servicemembers that were stationed overseas, in other 
countries, and that was not always the case. In fact, it was 
sometimes regular that they could expect a power outage for up 
to 3, 4 hours daily. And as Americans, we know when it happens 
for an hour once or twice a year we get absolutely furious, and 
our heads want to explode.
    An elaborate network of power plans, transmission lines, 
and distribution nodes work every day to delivery electricity 
where and when it is needed. However, as demand grows so do the 
risks for that reliability to fail. In 2023, the North American 
Electric Reliability Corporation, or NERC, which serves as the 
watchdog for grid reliability, released its long-term 
reliability assessment, and that assessment warned regulators 
and utilities that more reliable capacity was needed to 
mitigate the challenges presented by growing electricity 
demand. That is why it is urgently needed, and it is urgently 
important for Congress to engage in serious discussions to 
identify the risks to this reliability and safeguard our grid 
against threats.
    Many of these threats do not come from within the network. 
So, where do they come from? Weather, of course, poses a 
significant risk to the grid. We have also seen foreign 
adversaries, or entities sponsored by them, use cyberattacks to 
cripple the grid, and that is something they can do from afar, 
half a world away.
    But many of these risks are caused by the Federal 
Government. New regulations proposed under this Administration 
will strain the system and the grid, and the grid is really 
just not prepared to handle it. Regulations including attempts 
to force car companies to only--and that is the key word here--
only manufacture electric vehicle create a significant new 
demand on the grid, one that many experts say is completely 
unsustainable. Regulations attempting to rid all fossil fuel 
power plants, despite the necessity in providing consistent 
power generation; regulations forcing more electric appliances 
onto the market despite the fact that, under the new standards, 
many of them will not work; not to mention this 
Administration's radical push for renewables while ignoring the 
need for power generation around the clock, not just when the 
sun is shining and, of course, the wind is blowing.
    What is the cumulative impact of all these regulations? 
Well, and you have to ask this question too--is our existing 
grid system even remotely prepared to deliver the volume of 
electricity these rush-to-green policies require? What do we 
need to do to ensure the American people have the reliable and 
affordable power that they need, and quite frankly, that they 
have become accustomed to? That is what we are here to find 
out.
    The Federal Energy Regulatory Commission, or FERC, oversees 
our Nation's bulk power system, including generation 
transmission and distribution of power needed to maintain grid 
reliability. We offered FERC the opportunity to appear at 
today's hearing. Unfortunately, FERC declined to participate. 
Luckily, we have the next best thing, which is former 
Commissioner James Danly, who can speak to the inner workings 
of FERC and how they should respond to these challenges. We 
also are going to hear today from Mr. Travis Fisher, and expert 
with significant experience at FERC and in the private sector.
    I hope our conversations here today will be insightful and 
help us better look into how we can prepare for the challenges 
ahead and what Congress should consider when debating issues 
impacting the security of our power grid.
    I want to thank all the witnesses for coming today, and I 
yield to Ranking Member Bush for her opening statement.
    Ms. Bush. Thank you, Mr. Chairman. St. Louis and I are here 
today to address the safety, security, and sustainability of 
the Nation's electrical grid. Decades of pollution and overuse 
and overreliance on fossil fuels have disproportionately harmed 
Black and Brown communities in St. Louis and throughout the 
world.
    Black children in St. Louis are ten times more likely to 
visit the emergency room for asthma than White children. Air 
pollution billowing from coal plants makes it harder to 
breathe, especially for Black communities already burdened with 
decades of systemic and structural racism and environmental 
inequities. Too many children in my community suffer from 
asthma. Too many parents, siblings, and friends die from 
preventable cancers.
    The time for change is now. This is quite literally a 
matter of life and death. Soot pollution from coal-burning 
power plants is responsible for 3,800 premature deaths in this 
country every year, according to a new Sierra Club report. Just 
17 coal plants are responsible for over half of those deaths, 
and Missouri is home to 2 of those 17. According to the report, 
94 Missourians die prematurely every year due to burning coal. 
A separate report last year ranked St. Louis one of the ten 
worst places in the U.S. for air pollution.
    Throughout my time in Congress, I have proudly worked 
toward climate-friendly policies. I continue to fight for a 
Green New Deal, including my own Green New Deal for Cities bill 
which would provide funding directly to city, state, local, 
tribal, and territorial governments to respond to the climate 
crisis and create hundreds of thousands of green jobs in the 
process.
    One other fundamental step to mitigating the climate crisis 
is building a clean and renewable power grid. In the last 
Congress, Democrats made significant progress toward 
environmental justice and a sustainable power grid, including 
passing the Inflation Reduction Act. The IRA is the largest 
investment in green energy in American history, yet, we still 
have much more work to do. Congress must support Federal 
regulators who step up and do their part, expand clean, 
affordable, and safe energy transmission, including FERC. The 
people of St. Louis sent me here to make sure they had clean 
and affordable energy that was not making them sick. I want to 
work with regulators to make that a reality.
    Republicans might sit here and tell you that renewable 
energy is a threat to our power grid, that it jeopardizes its 
security. This assertion is simply untrue. You know what 
threatens the grid depending on fossil fuel? Climate change 
exacerbated extreme weather events. In December 2022, Winter 
Storm Elliot struck St. Louis, bringing bitter cold and snow 
that strained the power grid. While St. Louis' fossil fuel-
based infrastructure froze over and failed, its wind power 
facilities made up the shortfall. Far too many of my 
constituents suffered in the bitter cold. Coal and natural gas 
let them down. But wind power exceeded expectations.
    We also cannot ignore the actions of domestic extremists, 
including white nationalists and white supremacists who have 
violently attacked electrical grids to stoke chaos and fear.
    In 2022 alone, DOE reported 163 electrical emergency 
incidents and disturbances, including physical attacks, a 71 
percent increase from 2021. In December 2022, a hate group 
attacked the power grid in North Carolina, leaving 45,000 
people without electricity, shutting down a school for 5 days, 
and leading to one person's death.
    In February 2023, the Federal Bureau of Investigation filed 
charges against two domestic extremists who conspired to 
destroy power stations around Baltimore. Then, again, in 2023, 
in April, Federal courts sentenced two more white supremacists 
for their scheme to destroy critical infrastructure to spark 
civil unrest.
    These incidents can no longer be considered isolated, you 
know, outliers. Last year, Ranking Member Garcia, Ranking 
Member Raskin, and I sent a letter to the Federal Energy 
Regulatory Commission and the Department of Homeland Security 
on extremism and energy terrorism. I am pleased that FERC is 
taking these threats seriously. Our government must ensure 
these attacks do not happen again.
    The people of St. Louis should be able to trust that the 
Federal Government takes every action to secure the power 
infrastructures that connect their homes, their schools, their 
offices, and their hospitals. Access to these basic utilities 
is a human right.
    That is why I have introduced the Recognizing Access to 
Utilities as a Human Right resolution. My bill would recognize 
access to water, sanitation, electricity, heating, cooling, 
public transit, and broadband communications as basic human 
rights, and public services that must be accessible, safe, 
acceptable, sufficient, affordable, justly resourced and 
sustainable, climate-resilient, and reliable for every single 
person.
    People should not have to risk their health, safety, and 
well-being in order to keep the lights on. My constituents need 
to know that when they flip a switch the lights and the heat 
will go on, and it will not cost them a fortune. We need to get 
renewable energy onto the grid to reduce emissions. We need a 
power grid that can endure the extremes of the climate crisis. 
Thank you.
    Mr. Fallon. I ask unanimous consent for Representative 
Casar from Texas to be waited onto the Subcommittee for today's 
hearing for the purposes of asking questions. Without 
objection, so ordered.
    I am pleased to welcome our witnesses for today's hearing, 
Mr. James Danly, Mr. Travis Fisher, and Mr. Jonathan Monken.
    James Danly is currently a Partner for Energy Regulation at 
Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates. 
Previously he served as the General Counsel Commissioner and 
Chairman at FERC. Travis Fisher is the Director of Energy and 
Environmental Policy Studies at the Cato Institute, and 
Jonathan Monken is Principal at Converge Strategies. We look 
forward to hearing your testimony and hearing from you all on 
today's important topic.
    Pursuant to Committee Rule 9(g), the witnesses will please 
stand and raise their right hands.
    Do you solemnly swear or affirm that the testimony you are 
about to give will be the truth, the whole truth, and nothing 
but the truth, so help you God?
    [Chorus of ayes.]
    Mr. Fallon. Thank you. Let the record show that the 
witnesses answered in the affirmative. Please take your seats.
    We appreciate you all being here, as I just mentioned, for 
your testimony. Let me remind the witnesses that we have read 
your written statements, and they will appear in full in the 
hearing record. Please limit your oral statements to 5 minutes. 
As a reminder, please press the button in front of you, the 
little red one, so we can hear you. When you begin to speak 
there will be a light. It will be green for 4 minutes and then 
1 minute yellow, and then when it is red, if you are in the 
middle of a statement, if you could just kind of wrap it up, 
that would be great. The runway is real short at that point.
    I now recognize Mr. Danly for his opening statement. Thank 
you, sir.

                      STATEMENT OF JAMES P. DANLY

                       PARTNER, ENERGY REGULATION

                          SKADDEN, ARPS, SLATE

                   MEAGHER & FLOM LLP AND AFFILIATES

    Mr. Danly. Chairman Fallon, Ranking Member Bush, and 
Members of the Subcommittee, it is an honor to be here today to 
talk about an important topic that really is of immediate 
interest to every American, and I appreciate the chance to 
share some of experiences from having been General Counsel and 
Chairman at FERC.
    It is impossible, as has already been stated, to exaggerate 
or overstate the importance of a stable bulk power system. 
Virtually every aspect of American life depends upon having 
affordable and continuous electricity. And this need that the 
United States has for its welfare, dependent upon continuous 
and stable electricity at reasonable prices, is at a time when 
load requirements are growing. The demand is going up, and it 
is going up in accelerating pace.
    So, the problem is that we are also, at the same time, 
experiencing a greater number of threats to the bulk power 
system. Among them are the physical and cybersecurity threats. 
There is also another threat to it, which is that of resource 
adequacy. And so, I just want to spend 2 seconds before we get 
to questions, as I did in my written testimony, drawing a bit 
of a distinction between two different concepts: resource 
adequacy and reliability.
    Reliability is that aspect of the bulk electric system that 
allows it to function and recover from predictable 
interruptions and problems quickly and without interruption of 
service. This is primarily driven by the NERC reliability 
standards, the standards that FERC oversees the promulgation of 
by NERC, and they are technical requirements. They are things 
like vegetation management protocols and proper operation of 
balancing authorities.
    There are also, for cyber purposes, the CIP standards that 
require certain types of minimal activities to be taken to 
ensure that critical assets are protected from cyber threats.
    Resource adequacy is something quite different. That is 
something that basically sounds in economics and regulation. 
Resource adequacy is the ability of the bulk power system to 
ensure that it can meet demand at all times, and you can have a 
perfectly reliable system--that is that if there were power to 
get to a place that needs it, it could get there, but if you do 
not have a sufficient quantity of power then you may have a 
reliable system, but you do not have a resource-adequate 
system.
    Resource adequacy comes down to a matter of either planning 
for the future properly and having accurate expectations for 
what the demand is going to be down the road, and 
administratively determining it and then building it. This 
usually happens in vertically integrated utilities or states 
that have vertically integrated utilities through the 
Integrated Resource Plan, or in the case of the FERC 
jurisdictional markets, the ISOs and RTOs, by having market 
rules that properly incentivize the development of needed new 
generation.
    One of the problems that the markets have had over the 
last, I do not know, let us say 10, 15 years, is that they have 
not always properly valued the new capacity that is required. 
And every market is different. The tariffs are different region 
to region. But there have been problems in properly 
incentivizing the arrival of new generation to meet load 
growth.
    This problem becomes all the more difficult when the 
markets have to operate and create those price signals upon 
which we rely to ensure resource adequacy when they are 
operating in the context of widespread and lucrative subsidies, 
which have the inevitable effect of warping price signals, and 
that means that you either over-or under-value the various 
types of resources that will ultimately come to the 
marketplace. And when resources are undervalued, you do not 
have enough of them, or you do not have enough of the right 
type of them.
    So, I just want to make that distinction so that it can 
inform the discussion going forward. The word ``reliability'' 
does not apply to both resource adequacy and the technical 
requirements that come from NERC standards. Reliability has a 
narrow meaning, and resource adequacy has a different meaning, 
but the two of them are obviously interrelated concepts, and 
both are worthy of discussion today.
    With that I look forward to your questions, and thank you 
again for having me up here.
    Mr. Fallon. Thank you, sir. I now recognize Mr. Fisher for 
his opening statement.

                        STATEMENT OF MR. FISHER

              DIRECTOR OF ENERGY AND ENVIRONMENTAL STUDIES

                             CATO INSTITUTE

    Mr. Fisher. Good morning, Chairman Fallon, Ranking Member 
Bush, and Members of the Subcommittee. I am Travis Fisher. As 
the Chair said, I am the Director of Energy and Environmental 
Policy Studies at the Cato Institute, a nonpartisan public 
policy research organization in Washington, DC. It is an honor 
to be invited to speak with you today about the reliability and 
security of America's power grid.
    At the turn of the millennium, the National Academies of 
Engineering ranked the electric grid the greatest engineering 
achievement of the 20th century. The power grid should be an 
asset to American prosperity, but policymakers, through a 
multitude of subsidies, regulations, and mandates, have wounded 
it, to the point that it is now becoming a dangerous liability.
    The stakes are high. A weakened power grid puts lives at 
risk. Reminders of this fact include the tragic loss of lives 
during Winter Storm Uri and the growing frequency of grid 
reliability events across the country. During extreme weather, 
Americans need reliable electricity to survive. Day-to-day we 
need reliable and affordable electricity to thrive and grow the 
economy.
    As I see it, there are two distinct paths forward regarding 
electricity policy. The first, which I support, is to embrace 
American values and foster an electric industry that harnesses 
free market competition to best serve the interests of 
consumers. This path recognizes the fact that most Americans 
are simply unwilling to sacrifice their well-being on behalf of 
a forced energy transition.
    The second path, which I fear is what we are on presently, 
is to force a transition to politically favored technologies 
that consumers do not want. Taking the second path is unwise. I 
want to highlight three major Federal policies that lie along 
this path and the harmful impacts they will have on the 
reliability and affordability of electricity in the United 
States.
    First is the Inflation Reduction Act, or IRA. The 
production tax credits in the IRA alone could cost American 
taxpayers $3 trillion by the year 2050. These tax credits 
reward electricity production from unreliable sources and 
distort the market signals that keep reliable power plants 
running. The result will be a weaker grid over time, not to 
mention a deepening fiscal crisis in the country.
    Second is the tailpipe emissions rule from the 
Environmental Protection Agency, or EPA. This proposal seeks to 
ensure that by 2032, two-thirds of new vehicles sold will be 
electric. Beyond taking away basic freedoms like the freedom to 
choose what kind of car to buy, this rule will place immense 
stress on the power grid by adding substantially to the overall 
electricity demand, which is already growing because we find 
new ways to use electricity all the time.
    Third is the power plant rule from the EPA. The proposed 
rule mandates two technologies that are not adequately 
demonstrated--carbon capture and green hydrogen. The EPA heard 
from White House reviewers that the technologies are not ready 
for prime time, but the EPA seems to be establishing a new 
standard for its mandates. It claims carbon capture and green 
hydrogen are adequately demonstrated because they are 
adequately subsidized by the IRA.
    Take these two rules together and it means significantly 
more demand on the grid and less supply. The result is 
increased prices and, unfortunately, a growing number of energy 
shortfalls. What that means for electricity customers is higher 
power bills and increased risk of blackouts. California has 
become the poster child in the United States for an aggressive 
energy transition. It is also the only state that mandates 
electric vehicles while asking people not to plug them in at 
certain times of day because the grid cannot handle it. This is 
not the American way. We should be able to buy the vehicles we 
want, fuel them when we want, and not be stuck with a $3 
trillion tab for an unreliable grid.
    Economist Frederic Bastiat was correct when he wrote, and I 
am quoting, ``Treat all economic questions from the viewpoint 
of the consumer, for the interests of the consumer are the 
interests of the human race,'' end quote. The American people 
want reliable electricity at low costs, and policymakers should 
listen.
    In living rooms across the country, having low-cost 
electricity can make the difference between light and darkness. 
During emergencies, having reliable electricity can make the 
difference between life and death.
    It is not too late to stop the coming energy crisis because 
it is a crisis caused by unwise policies, and we can reform 
them. The power grid can be an asset to the American economy if 
we let it. I urge you to choose the path that will lead to a 
bright future for America. Thank you.
    Mr. Fallon. Thank you, sir. I now recognize Mr. Monken for 
his opening statement.

                      STATEMENT OF JONATHON MONKEN

                               PRINCIPAL

                          COVERAGE STRATEGIES

    Mr. Monken. Good morning, Chairman Fallon, Ranking Member 
Bush, and distinguished Members of the Committee. Thank you for 
the opportunity to speak with you today on the vital subject of 
our Nation's electricity grid.
    My name is Jonathon Monken, and I am a Principal at 
Converge Strategies, where I advise clients at the Federal and 
state government level as well as the private sector, on the 
development and implementation of strategies designed to 
improve the energy resilience of critical infrastructure 
systems, with an emphasis on the U.S. Department of Defense.
    Often referred to as the world's largest machine, the North 
American grid is a vast network of assets designed to deliver 
electricity to all of its customers in a safe, efficient, and 
reliable manner. Today's hearing is timely for two reasons: the 
grid is undergoing an unprecedented transition related to the 
ways we generate and use electricity, and the reliable delivery 
of service to customers is under threat by natural and manmade 
risks that demand our collective attention.
    The issue of grid resilience must be understood as an issue 
of national security. Just as we would not leave the defense of 
our country to chance, the energy system that underpins our 
collective economic and reliability needs must be supported 
through targeted planning, investment, and policy. In my 
testimony I will provide context to both issues and highlight 
the importance of grid planning and oversight to address the 
risks that they represent.
    The grid transition is driven by two primary factors 
including unprecedented increases in customer demand, known as 
``load growth,'' and the transition to Carbon Free Energy 
sources of electricity generation. The Federal Government plays 
an essential role in developing policy, supporting technical 
standards, and collaborating with the private sector to ensure 
the grid is prepared to meet the energy needs of all citizens.
    Over the past year, grid planners nearly doubled their 5-
year load growth forecasts, with the nationwide demand for 
electricity expected to rise sharply from 2.6 percent to 4.7 
percent over the next 5 years, as outlined in 2023 FERC 
filings. This increased consumption is a reflection of more 
than $630 billion in private sector investment in new 
manufacturing, industrial, and data center facilities.
    Meeting this demand is essential to domestic economic 
growth, and requires deliberate action to deploy and sustain 
energy resources. Across all grid regions of the U.S., 2 
terawatts of new generation, more than 94 percent of which are 
renewables and battery storage, are queued up to meet this 
demand. Large-scale wind and solar power plants are competitive 
with existing conventional generation, and offer cheaper power 
than fossil fuel facilities. A recent analysis found that 99 
percent of U.S. coal plants are now more expensive to run than 
new solar, wind, and battery storage assets.
    The rapid deployment of new resources must be matched with 
a corresponding investment in electric transmission 
infrastructure to ensure these generation assets are connected 
to the growing demand in all regions of the country. The U.S. 
Department of Energy estimates that the transmission system 
will need to expand by up to 60 percent by 2030, to maintain 
reliable electric service, and that transmission investment may 
need to triple by 2050.
    This transition is occurring at a time when the grid is 
under threat from climate-driven changes in severe weather 
patterns, as well as targeted attacks on grid infrastructure 
from homegrown violent extremists conducting physical attacks 
and foreign adversaries utilizing cyber capabilities. There 
were 1,665 physical and cybersecurity incidents involving the 
U.S. and Canadian power grids in 2022 alone, including 60 
incidents that led to outages, representing a 71 percent 
increase over 2021.
    FBI Director Christopher Wray recently testified to 
Congress that, ``China's hackers are positioning on American 
infrastructure in preparation to wreak havoc and cause real-
world harm to American citizens and communities if and when 
China decides the time is right to strike.'' Exacerbating these 
security risks is the trend of increasingly frequent and severe 
weather events impacting the grid across the country.
    These risks highlight the importance of actively managing 
and assessing the balance and diversity of resources supplying 
the grid to avoid worst-case outcomes during adverse operating 
conditions. Recent Winter Storms Uri and Elliott highlighted 
the risks associated with the heavy dependence of a grid 
service territory on generators of a single fuel type within a 
limited geography. While all generators of all types 
experienced outages due to the cold weather and operating 
conditions, the outages were far more pronounced with natural 
gas generators. In the case of Winter Storm Uri, ``From 
February 8 through February 20, 2021, of the 1,293 unplanned 
generating unit outages, derates, and failures to start that 
were due to fuel issues, 1,121, or 87 percent, were due to 
natural gas supply issues.'' This resulted in more than 4.5 
million people losing power for as long as 4 days.
    Winter Storm Elliott saw a similar outcome, where 63 
percent of all generation outages, by megawatt, were from 
natural gas-fired plants. More comprehensive evaluations of 
fuel security are needed to identify the optimal mixture of 
generation types to reduce the risk of disruptions caused by 
fuel availability. This should include transmission planning to 
prioritize connecting regions with a greater diversity of 
resources to those regions with a high dependency on single 
fuels that could suffer from these common-mode failures. 
Expanded interregional transmission would help alleviate 
reliability issues associated with, for example, the forced 
outage rates of generation that far exceeded grid operator 
planning criteria during these recent cold weather events.
    Thank you again for the opportunity to discuss this 
important matter with the Subcommittee, I look forward to your 
questions.
    Mr. Fallon. Thank you, gentlemen. I appreciate it. I now 
recognize myself for 5 minutes of questions.
    Mr. Danly, you spent numerous years at FERC, including as 
General Counsel, Commissioner, and as Chairman. Last year, the 
EPA proposed a rule commonly referred to as the Clean Power Act 
2.0, which targets emissions from fossil fuel-fired power 
plants. On August 8th of last year, you sent a letter to the 
EPA Administrator Regan stating, and I quote, ``While the 
proposed rule could, by itself, significantly impair 
reliability, the Commission must also consider the proposed 
rule amidst the numerous other public policies that 
increasingly jeopardize the reliable operation of the bulk 
electric system.''
    Just how severely could the Clean Power Act 2.0 rule, in 
your opinion, impair grid reliability simply on its own?
    Mr. Danly. As the process was going forward my concern was 
that the EPA had not taken into consideration what the 
reliability consequences of the rule were going to be, and on 
top of that, and more specifically, there was no inquiry done 
at the time, and this was educed on the record during a hearing 
in front of the Commission during our Reliability Tech 
Conference. No specific inquiry was made into the effect on the 
markets.
    One of the biggest problems with these sorts of external 
effects on the power generation system is that the market 
mechanisms in which generators have to offer in, and it is on 
the basis of those offers that are then accepted through this 
bid stack that clears that the generators ultimately are going 
to be called upon to deliver power.
    When you have a very expensive regulatory system that is 
imposed that changes all of the pricing that the generators are 
going to be subject to or going to require in order to remain 
solvent. And if you do not have a clear view of what is going 
to happen in the markets, it is going to be very difficult to 
be certain that you are not going to suffer catastrophic 
consequence for resource adequacy down the road.
    So, by itself, I think that the Clean Power Plan could 
potentially create extraordinarily expensive prices in the 
markets, and what I am really concerned about is not that, 
because that is a public policy decision. What I am concerned 
about is that it seems to be undertaken without full knowledge 
of the consequence.
    Mr. Fallon. How much more could the other public policies 
to which you referred to, like the EPA's EV mandate and large 
government-funded subsidies for renewables, how could that 
impact the cost and reliability?
    Mr. Danly. So, there are a couple of ways. One is the more 
demand you have, the higher the price goes. That is Econ 101. 
There is another problem, which is that in order to get hold of 
the power that would come from the large deployment of 
renewables that a lot of public policymakers want and expect to 
have happen, there needs to be a huge buildout of transmission. 
I am skeptical that that buildout of transmission is even 
feasible given the cost. It is an extremely capital-intensive 
proposition to build out that amount of transmission.
    And given the regulatory risk that attends any large 
infrastructure project in the United States, it is very hard to 
site and construct long linear infrastructure projects. The 
likelihood of being defeated on appeal from NEPA if this were 
ever a matter of siting and permitting by FERC would be very 
high.
    And there is a reason why many of the transmission projects 
that have been proposed and talked about before have failed. It 
is either because they are unpopular and the citizens of the 
jurisdictions in which they are proposed simply do not want 
them, or we have problems with cost allocation in which they 
may be meritorious from an engineering standpoint, but they do 
not actually reduce the cost to the consumers.
    So, the more of these policies that are implemented, the 
more expensive the transmissions system is going to be, and 
that is going to result ultimately in a higher all-in build to 
end rate payers.
    Mr. Fallon. Let me ask you this, too. Your August letter 
stated that the EPA's assertions, that the EPA did not, in 
fact, consult the Federal Energy Regulatory Commission in its 
analysis of the proposed rules', quote/unquote, ``potential 
reliability effects.''
    Mr. Danly. I am sorry. I did not understand the question. I 
did write that in the letter, yes.
    Mr. Fallon. So, can you clear this up? What are the 
potential implications of the EPA's failure to properly solicit 
the Commission's counsel, especially on a rule which targets 60 
percent of our Nation's power generation?
    Mr. Danly. Well, I would have thought that it was fairly 
clear. If you engage in a large rulemaking that has profound 
effect on an entire segment of the economy without a clear 
understanding of what the reliability consequences are, not 
only do you fail to undertake the duties that are assigned to 
you, but you could potentially be engaging in policy that has 
unforeseen consequences that could be quite deleterious.
    These are the sorts of things where you probably ought to 
satisfy yourself that the consequences are known before you 
embark upon them fully.
    Mr. Fallon. OK. Thank you. And without objection I would 
like to request unanimous consent to enter into the record Mr. 
Danly's letters from August 8, 2023, November 8, 2023, and 
December 20, 2023, which outlines his concerns with this issue. 
Without objection, so ordered.
    I now yield to Ranking Member Bush for her 5 minutes of 
questions.
    Ms. Bush. Thank you, Mr. Chairman. St. Louis and I are here 
today for this convening on threats to our Nation's power grid 
and to elaborate on the real, actual attacks it faces by white 
nationalists across our country. For years, law enforcement and 
researchers have been monitoring violent white supremacist 
groups and their targeting of our country's power grid. Many in 
these groups call themselves accelerationists. They have put 
out how-to manuals to make it easier to attack critical 
infrastructure, like the electric grid, and are convinced that 
the best way to achieve their goal of a white supremacist 
future is to cause a societal collapse by plunging it into 
darkness.
    Mr. Monken, I briefly spoke during my opening remarks, but 
are domestic terrorist groups a current threat to the United 
States energy infrastructure?
    Mr. Monken. Yes, they absolutely are.
    Ms. Bush. Thank you. Unfortunately, those with hate in 
their hearts do not want to see all communities of people 
succeed, especially our Black and Brown communities. Over the 
last 2 years, the FBI arrested three different groups of white 
supremacists for attacking, or plotting to attack, our power 
grid.
    Mr. Monken, what steps have the Federal Government and 
Federal energy regulators taken to address the risk of physical 
attacks on the electric grid?
    Mr. Monken. Currently, I believe they are insufficient, 
frankly. There are some existing standards known as CIPs, or 
Critical Infrastructure Protections, specifically designated 
CIP 14 for physical security of critical installations or 
critical substations within the bulk electric system. But right 
now, it is still insufficient for what we need.
    Ms. Bush. Thank you. And then, Mr. Monken, what can 
Congress do better to ensure that the national electric grid 
system is safe from physical attack? What can we do?
    Mr. Monken. Having a clear understanding of what the most 
effective mitigation strategies really are, from a physical 
security standpoint, I think is hugely important. And then 
placing a significant priority on how those projects are 
ultimately introduced, reviewed for their just and reasonable 
costs, and then ultimately approved to make sure that those 
facilities are secure enough that we have confidence that they 
will deliver that reliable power that the people need.
    Ms. Bush. OK. Thank you. The people of St. Louis currently 
face high utility bills, extreme weather, and air that is 
unhealthy to breathe, and on top of all of that, white 
supremacists want to sabotage the power grid and foment chaos 
and fear in our communities. We must invest in and foster the 
growth of green energy and the infrastructure needed to deliver 
power to the people of St. Louis. I look forward to working 
with FERC to make this happen as quickly as possible. My 
constituents do not have time to wait.
    Now on the issue of our clean energy transition, according 
to the National Oceanic and Atmospheric Administration's chief 
scientist, quote, ``Not only was 2023 the warmest year in 
NOAA's 173-year climate record, it was the warmest by far,'' 
end quote. That is scary, and it is unacceptable. It is 
unacceptable for our children and for our grandchildren who 
will inherit this mess if we do not address the horrors of 
climate change.
    So, Mr. Monken, very briefly, how does climate change 
affect the communities' need and demand for energy?
    Mr. Monken. Well, in a very significant way, recognizing 
the fact that not only are these climate-driven events a 
significant exacerbator of existing challenges that we have for 
grid reliability, meaning they are more likely to cause the 
types of outages at both the scale and the duration that are 
going to have those very human consequences, they also 
disproportionately affect communities of low economic status, 
recognizing they disproportionately affect these minority 
communities that do not have the financial wherewithal or the 
ability to avert the worst case impacts of those particular 
disasters.
    So, it is something that we really need to address through 
a delivered action toward energy equity, recognizing that the 
ability to pay is not the prerequisite for the ability to 
receive the reliable power that you need.
    Ms. Bush. That is a quote. In my opening statement, I spoke 
of my constituents in marginalized communities who bear the 
brunt of the high cost of burning fossil fuels for power 
generation. These costs can be both physical and monetary. Mr. 
Monken, can you briefly explain how investing in clean power 
grid enables economic growth?
    Mr. Monken. Absolutely. The aggregated economic impacts of 
the clean energy transition are dramatic and significant, and 
when we look at where jobs can be really built and sustained in 
support of the green energy transition, it is a much more 
equitable distribution of where those jobs can really be built, 
and then again, sustained as we get through the transition 
itself.
    So, recognizing that this is a necessary driver, we should 
not be in the back seat for the clean energy transition and let 
even global adversaries take a pole position on how this 
transition occurs. We really need to enforce our right to be 
able to be the first movers in this space and harness the full 
economic value of it.
    Ms. Bush. Thank you, and I yield back.
    Mr. Fallon. The Chair now recognizes Mr. Donalds from 
Florida for his 5 minutes of questions.
    Mr. Donalds. Thank you, Chairman. Let us talk blackouts for 
a moment. Every minute, every blackout, money is lost to the 
American national economy. National security is also put at 
risk. According to the Uptime Institute, in 2022, their outage 
analysis, more than 60 percent of significant power outages 
result in at least $10,000 worth of economic loss.
    Mr. Fisher, do you agree with this statistic?
    Mr. Fisher. I do agree with it, and, in fact, I am 
concerned that that is going to keep going.
    Mr. Donalds. OK. Thank you. A couple of examples. You have 
the East Coast blackout in 2003. The power outage blacked out 
eight states, 50 million people were blacked out for 2 days, 
approximately $10 billion were lost in economic output, $1 
billion worth of losses in New York City alone. I remember that 
one because my mom told me she had to walk back across the 
Brooklyn Bridge from Manhattan because everything was shut 
down.
    Example No. 2, Winter Storm Uri in Texas in 2021. Extremely 
low temperatures caused blackouts resulting in deaths of 200-
plus people, cost tens of billions of dollars in economic 
damage.
    Mr. Danly, on a day-to-day basis, what is the No. 1 cause 
of power outages in the United States?
    Mr. Danly. I am not sure what the No. 1 cause is. They 
range from unexpected outages of transmission lines to 
maintenance issues with the generators.
    The thing is when you talk about outages there are two 
different types. There is the outage for the bulk power system, 
which is the wholesale power system that FERC regulates, and 
then there are the much, much, much more common outages, which 
are at the distribution level. That can be caused by somebody 
running a car into a pole.
    Ninety-nine percent, I would guess, of the outages that 
people experience are distribution-level outages and do not 
ever implicate the fundamental stability of the bulk electric 
system. Those are inconvenient, and they do cause real economic 
harm, but they can be repaired with relatively minor fixes. I 
mean, we are speaking in relative terms here.
    It is when the bulk electric system itself has a blackout 
that you have real problems because bringing the system back 
online or bring up generation to meet demand can be very 
challenging. So, there has to be a distinction made between 
distribution-level events, 99 percent of the problems we have, 
and the more profound and serious cases for the bulk electric 
system.
    Mr. Donalds. All right. So, let us dig into bulk electric 
system outages. Currently, roughly 60 to 75 percent of the grid 
is what we would call fossil fuels and/or energies like nuclear 
that are consistent in output. Roughly 20, 21 percent is now 
solar panels and wind turbines. What is the issue with solar 
panels and wind turbines in terms of being a part of the 
overall bulk power portion of the electric grid?
    Mr. Danly. So, I do not actually know if the statistics you 
quoted there are for name plate capacity capacity or actually 
delivered energy. I am not sure which of the two it is. So, I 
think it is a little high if you are talking about actual 
delivered energy.
    But the dispatchable resources you are talking about--
thermal resources like coal and gas, hydro power, and nuclear--
are capable of being, unless there is some unexpected 
maintenance problem or the like, are capable of being 
scheduled, and you can be certain that they are going to be 
there when required. You choose them based upon what the least 
cost unit is to dispatch, but the one thing you know is that if 
prices rise you will still have those to rely upon.
    Wind and solar, intermittent resources, unless they have 
some kind of a battery backup do not have the ability to 
deliver power at any time. It is only when the resource is 
available--the sun is shining, or the wind is blowing--they are 
intermittent.
    They also have another problem which is that they are not 
as easily able to offer the ancillary services to the 
transmission system that the transmission system relies upon. I 
am talking about things like voltage support. These are 
ancillary services that are absolutely required by the 
transmission system, and inverter-based resources historically 
have not done that. They are working on what they call grid-
forming inverters, but they are not widespread.
    Mr. Donalds. I want to just cleanup.
    Mr. Danly. Sure.
    Mr. Donalds. So, in other words, when you are dealing with 
natural gas, nuclear, hydro power, thermal, et cetera, those 
are consistent deliveries to the overall grid. There is never 
really any downtime in those. But wind and solar have 
downtimes, like if the wind is not blowing or the sun is not 
shining. Correct?
    Mr. Danly. For the most part you are able to predict the 
downtime of the thermal and dispatchable resources, yes.
    Mr. Donalds. OK. Secondary question, and actually, Mr. 
Chairman, for the record, I want to submit an article, ``The 
U.S. has billions of wind and solar projects, good luck 
plugging them in,'' written by the New York Times, February 23, 
2023.
    Mr. Fallon. Without objection, so moved.
    Mr. Donalds. All right. So, Mr. Danly, a quick followup on 
all of this. With all of these solar and wind projects that are 
trying to come online, if they are not consistent flows like, 
say, nuclear, is battery technology sufficient to capture the 
generation of these energies so that they can be applied to the 
grid?
    Mr. Danly. Not in any way that would be affordable or 
widespread, no. Not right now, and probably not for the 
foreseeable future.
    Mr. Donalds. Thank you. I yield.
    Mr. Fallon. The Chair now recognizes Ms. Brown from Ohio.
    Ms. Brown. Thank you, Mr. Chairman. This is one topic where 
we can all agree, our power grids are critical to the Nation. 
Unfortunately, the grid is under threat from multiple 
directions. Climate change is straining our aging grid and 
stressing the system during increasing heat, cold, and other 
extreme weather systems. In the worst-case scenario, grid 
failures can mean no air conditioning during a heat wave, no 
lights during a late-night thunderstorm, or a skyrocketing heat 
bill in the winter.
    As a Member of the Select Committee on Strategic 
Competition with the Chinese Communist Party, I have also heard 
firsthand about the CCP's hacks of our electric grids and the 
danger it poses on our national security. And echoing Ranking 
Member Bush, the power grid has become a new target for 
domestic extremists attempting to destabilize our country and 
foster fear and chaos, particularly in the Black community. 
This is absolutely unacceptable, and I applaud the Department 
of Justice for holding these bad actors accountable.
    The Biden-Harris Administration and Democrats in the 117th 
Congress made unprecedented and historic investments in our 
Nation's power grid by passing laws like the Bipartisan 
Infrastructure Law and the Inflation Reduction Act. These laws 
provided billions of dollars for hardening the grid against 
severe weather, preventing electricity outages, and promoting 
green energy infrastructure.
    So, turning to you, Mr. Monken, how would you characterize 
the impact of the Bipartisan Infrastructure Law's nearly $15 
billion electric grid reliability, resilience, and 
cybersecurity investment?
    Mr. Monken. Frankly, it is transformative. So, essentially, 
it provided a level of funding that had not been seen 
previously when it comes to making targeted investments that 
directly support the types of grid reliability and critical 
infrastructure availability that we are discussing in the panel 
here today. So, being able to make that type of investment is 
foundational to making sure that not only are we successfully 
making the clean energy transition, but we are also trying to 
put the infrastructure and security measures in place to really 
avoid the types of worst-case outcomes that we are describing 
here. So, it is an essential contributor to what we need to do.
    Ms. Brown. Thank you. And Mr. Monken, how do you see these 
Biden-Harris investments in our energy grid lowering costs for 
all of us in the long term and promoting a cleaner environment?
    Mr. Monken. Yes, the low-cost component of this, I think, 
is essential to the discussion because it really needs to be 
emphasized that when we are talking about what is the most 
competitive and what is the lowest-cost form of electricity 
generation, it is really stabilizing investments in those 
particular areas. So, it really is going to have a stabilizing 
effect overall across the country on making sure that we have 
affordable and clean power.
    It also really sets the conditions for success of being 
able to make the scale of investment in infrastructure like 
high voltage transmission that can continue to lower overall 
costs for consumers across the country.
    Ms. Brown. Thank you. And lastly, Mr. Monken, how do 
problems with our energy grid disproportionately harm low-
income and Black and Brown communities, and how does Biden's 
Justice40 Initiative to ensure 40 percent of benefits from 
Federal investment reach marginalized communities come into 
play?
    Mr. Monken. It is really central to what needs to be done 
when we look for long-term reliability of the grid, recognizing 
when we look at areas with really either low economic activity 
or disproportionately affected communities that are harmed by 
these severe weather events that we see. Those are populations 
that do not have the independent financial means to be able to 
just address these on their own.
    So, while people that have the economic means can either 
move out of the area or go somewhere else or they can buy an 
expensive generator or a set of solar panels to put on their 
house or a battery to put on their house that is not readily 
available in the open market, these are communities that cannot 
go and do those types of things. So, trying to understand what 
needs to be done proactively to address that in advance of an 
event, that has that type of disproportionate effect, is 
essential to making sure that we do not have to deal with it 
after the fact, after the people that lost that reliable power 
suffer as a result.
    Ms. Brown. Thank you so much. The Biden-Harris 
Administration is making the largest ever investment in our 
Nation's power grid, thanks to the funding from the Bipartisan 
Infrastructure Law and the Inflation Reduction Act. These 
investments all across the country are protecting the grid from 
climate change and advancing equity for Black and Brown 
communities. And with that I yield back.
    Mr. Fallon. Thank you. The Chair now recognizes Ms. Norton 
from Washington, DC.
    Ms. Norton. Thank you, Mr. Chairman. Mr. Monken, in July 
2023, the Federal Energy Regulatory Commission issued a final 
rule to more quickly integrate facilities generating renewable 
energy into the U.S. electric grid system. This effort to 
expedite power sources into the grid includes wind and solar 
power sources. This rule is a long time coming and aims to help 
mitigate a nationwide backlog of clean energy suppliers seeking 
interconnection to the national power grid in ways that create 
cleaner energy at lower cost with greater reliability.
    So, Mr. Monken, why is it crucial for renewable energy to 
be a lasting, sustainable part of the national power grid?
    Mr. Monken. As I mentioned in my opening comments, it is so 
important to have both geographic and fuel type diversity 
within the bulk electric system. This is especially relevant 
for D.C., because there are no bulk electric system generations 
within the boundaries of the District of Columbia. So, being 
able to make these types of targeted investments and setting 
policy that makes it easier for those types of resources to 
come online has a tremendous impact on the populations that 
they ultimately serve.
    So, in this particular instance, being able to clear some 
of these roadblocks that allow more of these resources to enter 
into the system really opens up these additional opportunities 
to make sure that there is adequate energy to meet everybody's 
needs.
    Ms. Norton. Well, Mr. Monken, how does adding more 
renewable energy to our national power grid help make it more 
secure from both cyber and physical threats?
    Mr. Monken. So, the nature of renewable energy itself, it 
does not require the same level of control systems that are 
necessary for both spending reserves of fossil-burning plants, 
just in general, and just understanding that if you can co-
locate a lot of these renewable energy resources, because the 
difference between living close to a coal plant, as was raised 
the Ranking Member, and the difference between living next to a 
clean-burning renewable energy resource really makes a 
significant difference in how far that electricity has to 
travel in order to serve the loads that are nearer to it.
    So, I think you have a couple of different opportunities 
here, from a security standpoint, to really deploy renewables 
in a much more secure manner. These are really modern resources 
that we have the ability right now to build security in as we 
deploy them, recognizing that they are more distributed in 
nature, they are more closely located to the loads that they 
serve, and they give us better opportunities to ensure that 
they are protected when they go in.
    Ms. Norton. Mr. Monken, right now renewable energy sources, 
like onshore wind, have lower energy generation costs than new 
coal and natural gas plants. These renewable energy sources 
offer less expensive power options for renewable energy 
sources, offer less options for consumers than existing fossil 
fuel facilities provide, according to a recent International 
Energy Agency report. These energy sources are more affordable 
today than they have ever been in the past, greasing the 
economic wheels of a clean power grid.
    Moreover, failing to upgrade the U.S. electrical grid 
system limits the potential transformative possibilities of the 
Inflation Reduction Act landmark legislation Democrats passed, 
and the Biden-Harris Administration is breaking ground on 
Inflation Reduction Act projects in communities across the 
Nation.
    So, Mr. Monken, how does the Federal Energy Regulatory 
Commission's new rule dovetail with the Inflation Reduction Act 
to transform communities?
    Mr. Monken. I think this is FERC taking the opportunity to 
recognize that this is a volume game, and I think we have 
agreed in the way that we have communicated how we need to try 
and address reliability issues is with large-scale deployment 
of energy resources. So, going back to a question around, or a 
comment around resource adequacy, this is the opportunity to 
make sure that we can deploy the scale of power generation--in 
this case, clean power generation--to try and meet the growing 
demand that we have on the system.
    So for FERC, I think it really comes down to making sure 
that there is a clear understanding of the ways in which we can 
facilitate things like investment in transmission to supplement 
the investment in clean energy that we are making right now, 
and I think that is central to the issue that needs to be 
addressed, is making sure that the grid is able to receive all 
of that power that needs to come onto the system and deliver it 
to the people who need it.
    Ms. Norton. Thank you, Mr. Monken.
    Mr. Donalds [presiding]. The Chair recognizes Ms. Stansbury 
of New Mexico.
    Ms. Stansbury. All right. Well, good morning, everyone. I 
am excited to talk about grid modernization and transition here 
today because I happen to be one of those grid nerds, like some 
of the others who are here in this hearing today.
    And, you know, I think it is actually great to use this 
Committee and other committees to talk about this important and 
revolutionary transition that is happening both to our economy 
as well as our infrastructure because much of our grid was 
built over the last 100 years, is coming to the end of its 
design life, we are bringing on all these new, different 
sources of energy, and our planet is undergoing this massive 
transformation.
    And I am particularly excited to talk about the huge, huge 
investments that the Biden Administration has made in this 
transition. In fact, the Biden Administration, as has been said 
here in this hearing this morning, has made once-in-a-
generation investments in our grid, in technology, in reshoring 
manufacturing through the bills that we have been talking about 
and that we passed here in this body, the Congress before this.
    So, that includes the Inflation Reduction Act, as we have 
been talking about, the Infrastructure Investment Act, as well 
as the CHIPS and Science Act. And this represents, in total, 
the largest single investment in the clean energy revolution, 
not only that the United States has ever made, in America, and 
our economy, but that any country ever in the history of the 
planet has made, in any country.
    So, it is really, I think, an exciting moment but also a 
perilous and frightening moment, in part because we know 
climate change is real, it is happening. We already are seeing 
the warmest winter ever in history on record this winter and 
the largest increase in temperature this last year across the 
country. And we know that this transition has to happen 
quickly, and that if we do not use public policy to incentivize 
that transition we are going to end up in a really bad 
situation.
    So, you know, in particular, I represent the state of New 
Mexico, and New Mexico is really at the forefront of this 
energy transition. We have two national laboratories which are 
at the forefront of research. We actually passed some of the 
most forward-leaning renewable portfolio standards in 2019. And 
when I was in the State House, I collaborated with our Governor 
to literally write and pass bipartisan grid modernization 
legislation to address many of the issues that have been raised 
here today.
    But what we are seeing is that in states that have good 
policy, like New Mexico, they are really poised to take 
advantage of the massive investment that we are making through 
President Biden and Democratic investments in the clean energy 
revolution.
    Just this last year in New Mexico, we cut ribbon, about 8 
months ago, on literally the largest wind farm in North 
America, which is in my district. And it will be providing 
electricity all across the West. We just cut ribbon on the 
largest wind turbine manufacturer, for the actual turbines 
themselves, in my district just a few months ago, made possible 
by the Inflation Reduction Act. We just cut ribbon in my 
district, just a few months ago, on the very first reshoring of 
solar arrays back to the United States from overseas since the 
passage of the Inflation Reduction Act. And Intel Corporation 
is putting in its largest chip manufacturing expansion in the 
United States in my district.
    Now, if anyone has any question about whether or not these 
bills are helping to accelerate and turbocharge the clean 
energy revolution and address the issues that we are talking 
about here today, I can tell you, unequivocally, they are 
creating thousands of jobs in my district, they are helping 
modernize our grid, they are creating opportunity in 
communities that have long struggled with economic challenges, 
and it is transforming our energy economy across the West. And 
New Mexico is poised to do that because we had forward-thinking 
politicians who sat in seats like we are sitting right now, to 
help pass laws to help this transition happen.
    So, Mr. Monken, I do want to ask, you know, we have heard a 
lot of sort of fear mongering and scary stuff about the grid, 
but what can we do at the Federal level to really accelerate 
the grid modernization and clean energy transition? What are 
the three main things that Congress can do?
    Mr. Monken. Thanks for the question, and I think first and 
foremost being able to recognize the fact that this needs to be 
a holistic strategy that includes access to all of the 
technologies that are potentially available. I think a 
continued investment in the onshoring of production 
capabilities for essential components that we need as part of 
this transition is hugely important to the process, to make 
sure that everything that we need to build this system is 
available to us. So, that is certainly helpful.
    Economic stability and predictability are essential. We 
have seen an incredible amount of investment in response to the 
amount of money that has been made available by the Federal 
Government so that people have more predictability about the 
potential success of their investments. That is reflected in 
the $680 billion that has been invested in clean manufacturing, 
industrial capacity, and data centers in the United States 
since the passage of both of the pieces of legislation you 
described.
    And I think the last and possibly the most important 
component right now is to include transmission in the next 
round of legislation, that is actively targeting how we really 
incentivize infrastructure investment in the country, to make 
sure that all of those pieces fit together. We have addressed 
it from the technology standpoint and the consumer standpoint. 
Now we need to make sure we can make those two pieces meet.
    Ms. Stansbury. Great. Thank you.
    Mr. Donalds. The gentlelady's time has expired. The Chair 
recognizes Mr. Casar from Texas.
    Mr. Casar. Thank you, Chair. Today, I want to talk about 
Texas, and I want to submit into the record an article from 
today's Houston Chronicle that states ``Texas had the most 
power outages in the country in the last 5 years, new report 
finds.''
    Mr. Donalds. Without objection.
    Mr. Casar. Thank you, Chair. Texas has had severe power 
outages. We have been talking about them today in Committee, 
especially how Winter Storm Uri took hundreds of lives and left 
millions and millions of people without power.
    And my first question is actually for you, Mr. Fisher. It 
is not news that the Cato Institute, where you are at, is on 
the right end of the political spectrum. It would not shock 
anybody to find out I am a progressive's progressive. But there 
have been areas of important agreement that we have discovered 
in some of these Committee hearings. For example, having a more 
free and fair and legalized system of migration is a place 
where many progressive, and your organization, have actually 
found some common ground. And I have questions for you on this 
issue first.
    So, my first question for you is actually not about the 
electric power grid but about, for example, Texas exports oil, 
famously exports LNG. And I would assume that your organization 
would frown upon Texas not being allowed to export or import, 
say, liquid natural gas or oil and gas.
    Mr. Fisher. Yes, I see that as a free market, a free trade 
issue.
    Mr. Casar. Exactly. We have an issue for 90 percent of 
Texas, where we actually are not able to export electricity 
when we generate more electricity than it is that we are going 
to buy. And we also cannot import it when we can find lower 
prices from other states or other generations or when there is 
scarcity, like we had in Winter Storm Uri. And so, would your 
organization see it as important for regulators to not prevent 
the export or import of electricity if Texas is, in fact, 
generating quite a bit of that?
    Mr. Fisher. So, my take on this is actually that there is 
no explicit limit to trade. There are DC ties, so there are 
direct current ties that go from ERCOT to outside of ERCOT.
    However, the thing that I would note, as free market as we 
are, one of the issues that--I will speak for Cato and for 
myself--federalism matters, especially in this area where the 
grid is so complicated, that if we do not have a patchwork of 
experiments that the states offer we lose out on crucial data 
on what works and what does not.
    Mr. Casar. Understood. And I would assume that whether the 
Federal Government mandates connections or not or subsidizes 
them or not might be areas of disagreement. But I actually am 
genuinely looking for areas of agreement here.
    And so, if the private industry were interested in 
interconnecting ERCOT to be able to sell power back and forth, 
and wanted to do that of their own accord, but regulators were 
to say, ``No, we do not want to do that,'' would that be an 
area where you and I would agree, potentially, that private 
actors should be allowed to interconnect between Texas and 
other areas to reduce prices for Texans, increase 
competitiveness, and increase reliability? Again, the method of 
getting there we might disagree, just like in other areas. But 
I am just trying to figure out, because frankly, in other 
Committee hearings I have been surprised to find that there are 
areas where we are trying to get to a similar policy goal.
    Mr. Fisher. As I view this issue, in fact, it is a state 
policy issue, so it is not up to me. It is up to the state of 
Texas. I have never lived in Texas, but I know that you do not 
mess with Texas, and that is kind of the approach that I take 
to this. It is a state policy issue, and I do not believe it is 
the Federal Government's job to come in and tell Texas what to 
do.
    Mr. Casar. I understand, and again, I am not asking you 
that question. I am asking would you support regulators saying, 
``No, you cannot sell power in and out of Texas''? And it is 
OK. You can think about it and maybe next time less of a----
    Mr. Fisher. No, it is entirely up to Texas. The folks of 
Texas who want to make that policy, it is entirely up to them.
    Mr. Casar. Well, the policy decisions of folks in Texas 
have left 90 percent of people isolated on ERCOT, but some 
parts of Texas are not, whether you are in Chairman Fallon's 
district up in north Texas, significant parts of his district 
not on ERCOT, Ms. Escobar's district in El Paso, in the western 
part of Texas, or Mr. Weber's out in Beaumont, that are not in 
ERCOT. Those areas suffered way fewer outages, much fewer 
outages. They still suffered outages but much less blackouts 
than those folks that were on ERCOT.
    So, Mr. Monken, I have a question for you. You have been 
talking about how important it is to build out transmission. In 
your view, is it the best thing for energy competitiveness in 
the country, for electric reliability across the country, and 
for preventing these blackouts for us to allow interconnections 
in and out of Texas?
    Mr. Monken. Yes. I think the proof is in the data, in 
recognizing that areas that are not subjected to that level of 
isolation, from a transmission standpoint, are historically 
lower cost for the consumer and higher reliability for those 
consumers, as well.
    Mr. Casar. Thank you, Chair, for the time. I look forward 
to working across the aisle, if we can, on this issue. I yield 
back.
    Mr. Donalds. The gentleman yields. Seeing no other Members 
are here in the hearing today, the Chair recognizes the Ranking 
Member for her closing statement.
    Ms. Bush. Thank you. The price of energy poses a real 
problem for the people of St. Louis, but so does smog and 
greenhouse gasses, climate change, exacerbated superstorms. 
Thankfully, one solution can bring energy prices down and lower 
greenhouse gas emission--fortify the power grid with renewable 
energy options. Renewable energy sources like solar and wind 
provide both cleaner and cheaper power.
    Energy issues are complex, but I came to Congress to take 
on hard challenges. The people of St. Louis know from personal 
experience that coal, the fuel of the 19th century that clouded 
their lungs for generations, is not the best way to power 21st 
century communities. Families and children in my district have 
suffered enough from the mistakes of the past, and I cannot 
allow harmful practices to continue.
    Democrats in Congress are doing the hard work to catalyze 
new climate-friendly solutions. Last Congress, we made the 
largest investment in green energy in history with the 
Inflation Reduction Act, and I will keep fighting for the Green 
New Deal, including my new Green New Deal for Cities.
    My colleagues may complain that investment in renewables in 
the power grid is interfering in private industry, but they 
always seem to forget that taxpayers pay about $20 billion 
every year in subsidies to fossil fuel companies. I thank our 
witnesses today for your testimony about the future of FERC, 
but we all know the problem.
    Currently, there are two terawatts of power sitting in a 
bureaucratic queue, more than half of the current power in use 
in the entire United States, just waiting to join the power 
grid. Roughly 95 percent of that new power has no emissions. 
The new FERC rules should tackle that backlog, but we need to 
incentivize clean energy entrepreneurs to take prudent risks on 
these new projects. So, we need to let them know that we are 
ready for their contribution.
    I know my colleagues have concerns about the consistency of 
sun and wind, but new smart grids can help share the load and 
make up for when the sun shines in one area and freezes over in 
another. But in Texas, St. Louis, New Mexico, we learned that 
fossil fuels are not the right energy solution. That is the 
proof we need more energy options to weave a resilient power 
grid.
    While we are trying to build a reliable power grid, there 
are also those here and abroad who plot to plunge us into 
darkness. I appreciate the robust and necessary discussion 
surrounding the need to secure our power grid from white 
supremacists, physical attacks, and foreign government 
cyberattacks. Our energy infrastructure faces foreign and 
domestic threats each and every day, and Congress must work 
with Federal agencies and state and local governments to secure 
our infrastructure from potential attacks.
    The people of my community need to know their lights will 
turn on and the heat will kick in when they need it, and they 
need to know the methods generating that power are not hurting 
their lungs. It is clear--renewable energy will lower the cost 
and increase the reliability of power, as long as we in 
Congress continue to invest in clean, healthy energy solutions.
    Thank you, and I yield back, Mr. Chair.
    Mr. Donalds. The Ranking Member yields back. I yield myself 
time for a closing statement.
    First of all, to the witnesses, thanks so much for being 
here. I really appreciate your time. One of the things as we go 
through this conversation and these hearings about the national 
grid and the energy components of the grid, we must realize 
that the electric grid has transformed dramatically over the 
last several decades. Coal, obviously, used to be the dominant 
portion of our energy grid. That is no longer the case. The 
massive shift to natural gas in our energy grid has actually 
led to massive decreases in greenhouse gasses being emitted 
from electricity generation. That is how we have been able to 
lower our carbon emissions in the United States over the last 
15 years.
    Currently, U.S. electricity grid by source is 43.1 percent 
natural gas, 18.6 percent nuclear, 16.2 percent coal, 10.2 
percent wind, 5.7 percent hydropower, 3.9 percent solar, 2.3 
percent other. The electric grid is shifting all the time, and 
where we have to get focused in the United States is making 
sure that the most efficient and readily available abilities to 
power the grid so that consumers can get readily available 
power at cheap costs is the priority, not climate change.
    As we have heard here today, our Nation's power grid is 
facing a serious reliability crisis. Grid planners anticipate 
that power demand is expected to rise while power generation is 
expected to simultaneously decrease at an alarming rate. How 
are we expected to make up for this disparity when the Biden 
Administration continues to demonize our most reliable sources? 
Federal regulations and renewable subsidies are distorting our 
resource mix in ways that will make our electricity less 
reliable and less affordable to consumers everywhere, 
regardless of their politics, regardless of their income 
levels.
    Rules such as the EPA's rule on power plants, which have 
been wisely scaled back, would still directly impact the amount 
of additional capacity able to come online in the coming years. 
Electric vehicle mandates and other initiatives that would 
radically increase electricity demand would create additional 
strain on the system while further increasing our dependence on 
China for critical minerals. Essentially, if we go to more 
renewable energy we are going to need more batteries. If we use 
more batteries, the critical minerals for batteries are not 
mined in the United States. They are mined by the People's 
Republic of China. And we will be relying on China to expand 
and maintain our electric grid.
    I do not know about you, but that is not very smart.
    Simply put, the Biden Administration's never-ending quest 
for green-at-all-cost policies is making America's electric 
grid less stable. Even NERC's 2023 ERO Reliability Risk 
Priorities Report named the changing resource mix as the No. 1 
threat to electric reliability.
    Congress has a responsibility to oversee the massive 
Federal initiatives straining the system and impacting the 
reliability and resiliency of our grid. Americans rightfully 
expect electricity to be flowing, even when external factors 
such as severe weather events create strain on these systems.
    And while unforeseen risks to the electric grid are 
certainly a cause for concern, there are steps we can take to 
mitigate as many of the known liabilities as possible. This 
includes ensuring policies and procedures do not add 
unnecessary stress to our existing power capacity. Just as so 
many sectors depend on bulk electrical systems to function, the 
grid itself relies on an intricate resource supply chain to 
operate effectively. Delays in the permitting process of 
everything from natural gas pipelines to transmission lines add 
unnecessary uncertainty and costs to utilities, and ultimately 
costs to the consumers.
    As we look to build out the bulk electric system in time to 
meet growing demand, I urge my colleagues in Congress and the 
White House to recognize the limitations of a renewables-only 
agenda and implement policies that will safeguard, not 
jeopardize, Americans' access to power.
    I thank all our witnesses for being here today and for 
sharing their insights on these issues.
    In closing, I want to thank our panelists for today's 
testimony. With that, and without objection, all Members will 
have 5 legislative days within which to submit materials and to 
submit additional written questions for the witnesses, which 
will be forwarded to the witnesses for their response.
    If there is no further business, and without objection, the 
Subcommittee stands adjourned.
    [Whereupon, at 11:16 a.m., the Subcommittee was adjourned.]

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