Template model legislation called the Electricity Trajectory Management Act (ETMA) has been put together as a way for states to ensure the reliability of their electricity grids when those grids are being put under increasing strain due to rapidly increasing demand and because of a forced push toward making unreliable “green” energy sources such as wind and solar a much larger portion of the of the nation’s energy generation.

“The technology industry plans to accelerate the construction and utilization of electronic data centers and artificial intelligence projects,” the bill states, “which require tremendous amounts of electricity. Additionally, the federal government is inducing and forcing a transition from conventional vehicles to electric vehicles, which will also add substantial demand to the energy grid. Present electricity generation is insufficient to safely meet projected demand.”

ETMA would combat this by requiring the halting of any planned decommissioning of an existing “dispatchable” power facility if the purpose of decommissioning that facility is to replace it with a “non-dispatchable” power source.

A dispatchable power facility means a facility that can adjust its power supply to the electrical grid on demand, such as a natural gas turbine, a coal plant, a hydroelectric dam, or a nuclear plant. Non-dispatchable power sources, such as solar and wind, cannot be turned on or off in order to meet demand and are highly intermittent, meaning they are not continually available 24 hours a day because of factors that cannot be controlled (like cloud cover, daylight, wind speed, air density, etc.) and are therefore unreliable.

“American families and American industries depend on reliable and affordable electricity for everything they do, from medical equipment to lifesaving climate control in their homes and workplaces,” ETMA notes. “Electricity demand must be met with electricity supply instantly, or interruptions of service result. American electricity demand grew less than 0.5% per year between 2000 and 2023, and was flat between 2010 and 2020. Electric grid operators project a rapid increase in American electricity demand, up 4.7% between 2023 and 2028. Rapid growth of electricity demand without sufficient baseload generation in place to meet the demand jeopardizes reliability and affordability and will cause interruptions of service, often when needed most, during the hottest or coldest months.”

This large projected increase in electricity demand over the next few years will be caused primarily by the building and utilization of artificial intelligence projects and new electronic data centers such as cloud storage facilities by technology companies as well as the push by the federal and many state governments to transition Americans away from purchasing automobiles with gasoline-powered internal combustion engines in favor of “zero-emission” electric vehicles that require electricity to run.

While replacing a megawatt of electricity generation from, say, a coal plant with a megawatt of generation from a wind or solar source may appear to be an apple-to-apple swap, that is not the case. This is due to capacity factor, the measure of how often a power plant runs for a specific period of time, expressed as a percentage and calculated by dividing the actual unit of electricity output by the maximum possible output.

According to the U.S. Energy Information Administration, solar had a capacity factor of just 22 percent in 2023, while wind’s capacity factor was just 33 percent. Comparatively, the capacity factor for nuclear was 93 percent in 2023, while natural gas had a capacity factor of 58 percent, and coal 42 percent. So, a megawatt-to-megawatt swap from a dispatchable power source to these non-dispatchable sources results in a decrease in overall capacity. As more dispatchable sources of the grid are swapped for non-dispatchable sources, the less reliable the grid becomes.

“Restricting the supply of electricity without immediate substitutes jeopardizes reliability and affordability and will cause interruptions of service, often when needed most, during the hottest or coldest months,” ETMA says. “America’s coal and natural gas plants should not be recklessly decommissioned or regulated out of existence, they should be kept online to meet the projected rapid increase in electricity demand caused by new data centers and electric vehicles. [State public utilities commissions] must prioritize retaining and adding dispatchable, on-demand baseload power to meet the anticipated increase in demand.”

State legislators should look to protect their citizens from the threat of an unreliable and intermittent electric grid by passing the Electricity Trajectory Management Act or something similar in language and substance.

As ETMA argues, “the state has a duty to defend the production and supply of affordable, reliable, and secure energy from external regulatory interference. The state’s sovereign authority with respect to the involuntary retirement of an in-state electric generation facility for the protection of the health, safety, and welfare of the state’s citizens is primary and takes precedence over any attempt from an external regulatory body to mandate, restrict, or influence the early involuntary retirement of an electric generation facility in the state.”

The following is the full text of the Electricity Management Act:

Summary

The Electricity Trajectory Management Act will safeguard electricity reliability in light of projected rapid growth in electricity grid demand. The technology industry plans to accelerate the construction and utilization of electronic data centers and artificial intelligence projects, which require tremendous amounts of electricity. Additionally, the federal government is inducing and forcing a transition from conventional vehicles to electric vehicles, which will also add substantial demand to the energy grid. Present electricity generation is insufficient to safely meet projected demand. This Act requires a halt to decommissioning existing dispatchable power facilities for the purpose of replacing them with non-dispatchable power. This Act also directs the state public utilities commission to commission new dispatchable power sources to meet anticipated growth in electricity demand.

The Electricity Trajectory Management Act

The legislature of [name of state] finds that:

1. American families and American industries depend on reliable and affordable electricity for everything they do, from medical equipment to lifesaving climate control in their homes and workplaces;
2. electricity demand must be met with electricity supply instantly, or interruptions of service result;
3. American electricity demand grew less than 0.5% per year between 2000 and 2023, and was flat between 2010 and 2020;
4. electric grid operators project a rapid increase in American electricity demand, up 4.7% between 2023 and 2028;
5. rapid growth of electricity demand without sufficient baseload generation in place to meet the demand jeopardizes reliability and affordability and will cause interruptions of service, often when needed most, during the hottest or coldest months;
6. 230 coal plants, which produced 20% of American electricity in 2022, are being targeted for closure by activist groups, state and federal regulators, and utilities, with dozens across the nation slated for closure in the next three years;
7. the North American Electric Reliability Corp. (NERC), the Regional Transmission Organizations (RTOs) MISO, and PMJ have warned that large swathes of the United States face elevated risks of electricity shortfalls now and in the future;
8. restricting the supply of electricity without immediate substitutes jeopardizes reliability and affordability and will cause interruptions of service, often when needed most, during the hottest or coldest months;
9. America’s coal and natural gas plants should not be recklessly decommissioned or regulated out of existence, they should be kept online (readily available) to meet the projected rapid increase in electricity demand caused by new data centers and electric vehicles;
10. the [name of state public utilities commission] must prioritize retaining and adding dispatchable, on-demand baseload power to meet the anticipated increase in demand; and
11. newly built data centers should be the first to have their power curtailed in the event that new dispatchable power is not added to the grid and electricity blackouts or brownouts occur.
12. the state has a duty to defend the production and supply of affordable, reliable, and secure energy from external regulatory interference.  The state’s sovereign authority with respect to the involuntary retirement of an in-state electric generation facility for the protection of the health, safety, and welfare of the state’s citizens is primary and takes precedence over any attempt from an external regulatory body to mandate, restrict, or influence the early involuntary retirement of an electric generation facility in the state.

SECTION 1. Definitions

As used in this section:

(a) “Dispatchable” or on demand power means a source of electricity that is readily available for use on demand and can be dispatched upon request of a power grid operator, or one that can have its power output adjusted according to market needs, except for routine maintenance or repairs;

(b) “Reliable” means a source of electricity that is not subject to intermittent availability, has a performance standard of 80% or greater and only falls below that level during routine maintenance or repairs;

(c) “Electric generation facility” means a facility that uses water, coal, natural gas, or nuclear to generate reliable or dispatchable electricity for provision to customers;

(d) “Firm power” includes dispatchable, reliable power generation, as well as battery storage in excess of 24 hours. Firm power does not include power that is not dispatchable.

(e) “peak industrial user” means a physical location and/or facility that is industrial in nature and among the top 5% of energy users in their county.

SECTION 2. Protecting Electricity Users Reliability and Availability

(a) The commission shall not authorize or approve the retirement of a firm electric generation facility as proposed in a rate case, integrated resource plan or other submission to the commission, until there is the equal or greater contracted new firm power presently available on the grid, not from prospects in the future, to replace the loss of firm power brought about by the proposed closure.

In assessing the amount of firm replacement power needed, the commission shall consider imminent and planned firm power closures in other states of the member RTO as well as in our own state. If other states are not replacing their retired or firm power, or their firm power scheduled for retirement, with an equal or greater amounts of firm power, the commission shall add these shortages to their firm power replacement calculations before approving the closure.

(b) The commission shall prioritize new generation from dispatchable sources ahead of proposed new generation from non-dispatchable sources.

(c) The commission shall aim to increase dispatchable power by at least 5% between 2023 and 2028.

(d) In the event that dispatchable power does not increase at least 5% between 2023 and 2028, peak industrial users that begin operations after January 1, 2025 shall be the first to experience the impacts of any electricity blackout or brownout.

(e) If the Federal Government, through regulation, forces costly upgrades or other requirements leading to the closure of existing firm power plants, the State and commission shall seek waivers until there is replacement firm power available to the electric grid to replace the retirement.

If waivers are not granted, the state and commission shall seek a court injunction and bring litigation against the implementation of the regulations until firm power replacement is brought online. In order to protect electric reliability.

SECTION 3. Utilities; Rates and Charges; Loss of In-State Electrical Generation.

(a)  An in-state electricity generator that receives notice of any external regulatory action that makes continued operation economically infeasible or may result in the involuntary retirement or decommissioning of the generator’s facility shall inform the commissioner of the department of energy of the notice and regulation within 30 days after the receipt of said notice.

(1)  The department of energy shall open an investigatory docket to determine how such an involuntary retirement or decommissioning would affect the reliability and affordability of the state’s energy resources and to recommend any action necessary to defend the generator, including appealing to the attorney general to file an action in court or to participate in administrative proceedings.

(2)  The department of energy and the department of justice may seek funding from the legislative fiscal committee to conduct any actions under this section.

(b)  Any act or omission by a state agency inconsistent with this section shall not form the basis of any civil suit including, but not limited to, those seeking equitable relief or claiming damages.

SECTION 4. Severability

Each section, paragraph, and portion of each paragraph of this Act is severable. If one or more sections, paragraphs, or portions of one or more paragraphs of this Act are held invalid on their face or as applied to particular facts, then the remaining portions and applications of the Act shall be given full effect to the greatest extent practicable.

SECTION 5. Applicability and Effective Date

Heartland Impact can send an expert to your state to testify or brief your caucus; host an event in your state; or send you further information on a topic. Please don’t hesitate to contact us if we can be of assistance! If you have any questions or comments, contact Cameron Sholty, at csholty@heartlandimpact.org or 312/377-4000.