Last week, utility commissioners from several states testified before the House Energy & Commerce Committee’s Energy & Power Subcommittee hearing on how proposed EPA regulations for power plants would affect electricity reliability.
Trip Doggett (.pdf), President and CEO of Electricity Reliability Council of Texas, Inc. (ERCOT), explains that just one of the new rules would decrease power capacity and their ability to respond to times of increased electricity demand:
“[T]he CSAPR (Cross-State Air Pollution Rule) implementation date does not provide ERCOT and its resource owners a meaningful window for taking steps to avoid the loss of thousands of megawatts of capacity, and the attendant risks of outages for Texas power users …
“If the implementation deadline for CSAPR were significantly delayed, it would expand options for maintaining system reliability. ERCOT is advancing changes in market rules – such as increasing ERCOT’s ability to control the number and timing of unit outages and expanding demand response – that could help avert emergency conditions.”
Jon McKinney (.pdf), a member of the West Virginia Public Service Commission, notes that the effects of these regulations go beyond energy reliability, they also hit consumers’ pocketbooks:
“My concern is that the new EPA rules will denigrate reliability leading to more major interruptions during peak electrical usage …Lack of implementation time will leave utilities with only two choices both of which have significant negative reliability impacts: either scale back on generation to meet rulemaking requirements (in some cases as much as 50%) or shutdown prematurely …
“In WV and the Midwest these rate increases will hit electricity intensive manufacturing particularly hard, leading to industrial plant shutdowns and substantial job losses. It will also be disproportionately borne by consumers in some of the poorest rural counties in Appalachian Region states where there are many customers who are unemployed or on fixed incomes.”
Reliability will suffer, consumers will suffer, and as the Missouri Public Service Commission’s Jeff Davis (.pdf) points out, these increased electricity rates will dampen businesses’ ability to create jobs:
“By forcing the closure of a coal plant or small cluster of coal plants, these regulations are going to create some pockets on the grid that have an increased risk of reliability issues because the grid was designed and built on the premise that those plants are going to be there providing voltage support to satisfy local load requirements in respective systems throughout the country …
“More than 80% of the electricity actually consumed in Missouri comes from coal … More importantly, the stable supply of energy supplied by those plants combined with sharp-penciled regulation has produced some of the lowest electric rates in the country. Those rates and the reliability of those plants have attracted a number of manufacturers to Missouri over the years and now those jobs are being threatened by rising rates.
“The cost of EPA regulations, in terms of direct costs to ratepayers, as well as the cost of attempting to comply with these rules under accelerated timelines, will exact a dear price paid by everyone in this country who uses electricity. Rates are going to rise, more people aren’t going to be able to pay their bills, more jobs are going to move overseas and U.S. manufacturers are going to be further disadvantaged.”
According to Stan Wise (.pdf), chairman of George Public Service Commission, there has been no cumulative impact study on these proposed regulations. He is rightly pushing for Congress to “insist upon” studies before these regulations are enacted:
“No comprehensive study has been done by EPA to assess the combined impact of all of these rules on the price of electricity, on jobs, on the reliability of the electricity supply, and on the overall economy; and these rules as proposed and finalized don’t provide sufficient time for an orderly, deliberate technology installation program, as has been the case with past environmental rules. So we don’t know how much technology investment is required or the potential power plant retirements that could be caused by these rules – and causes me great concern from a reliability standpoint …
“Congress could aid in making this situation manageable by insisting upon a comprehensive study – preferably by an agency other than EPA – on the impacts of these rules and by providing more realistic timeframes for compliance that would increase reliability and reduce costs.”
So what can you do to make sure that these EPA regulations don’t harm reliability, increase electricity prices and cause job loss? Later this week, the U.S. House of Representatives is taking up the TRAIN Act, which would require the EPA to consider the economic effects of regulations it writes before putting them into place. By clicking here, you can tell your elected officials to support the TRAIN Act, and bring better economic accountability to the EPA.