Archive for November, 2011

It’s Time to ACT on MACT

With the Utility MACT’s Dec. 16 deadline rapidly approaching, there’s not much time left to tell your legislator how you feel about higher costs and a worse economy.

A few weeks ago, Behind the Plug ran a short series on five MACT Facts.Take a look at our five posts outlining the damaging impact of the proposed Utility MACT rule.

Now’s the time to tell the EPA to slow down. Write your legislator.

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EPA Rules Could “Ambush” Utilities

In a state where 67 percent of electricity comes from coal, utilities are standing up and telling the EPA to take a step back. As reported in the Kansas City Star, Kansas utility Westar Energy, along with KCP&L and Sunflower Electric, said that proposed EPA regulations are coming too quickly for the utilities to react, and that residents in Kansas could see decreased electricity reliability and higher electricity rates. Southwest Power Pool—a seven-state organization that ensures reliable supplies of power—has also told the EPA there is a risk of “cascading blackouts” and “localized rolling blackouts.”

Energy suppliers aren’t the only ones unhappy with the EPA’s proposed rules. Energy consumers in Kansas are also worried, with the Citizens’ Utility Ratepayer Board’s David Springe summarizing the situation for the Star:

“The EPA really kind of ambushed the utility, in terms of the process…Clearly they’re all working toward reducing emissions to the level the EPA wants. In their final order they were really radically different than the preliminary. They changed the mark they were supposed to hit and made it under a timeline that is simply not reasonable.”

“Whether it’s January or 2015, they have to retrofit the plants and rates will go up,” he said. “I don’t know that I’ve seen a full rate estimate, but it won’t be small.”

Kansas isn’t the only state that would see the negative effects of proposed EPA regulations.

The North American Electric Reliability Corporation (NERC) released a report yesterday concluding that proposed EPA regulations “may significantly affect bulk power system reliability depending on the scope and timing of the rule implementation and the mechanisms in place to preserve reliability.” As Platts reports, NERC says that these proposed rules could create “insufficient generating resources” and “threaten the stability of power grids in Texas and New England within the next decade.”

Twenty-five states with both Democrat and Republican governors have already indicated that the most expensive of the proposed EPA regulations, Utility MACT, could be harmful to their economic and energy security. That’s why it’s time to tell the EPA to slow down.

Midwest Asks for Changes to EPA Regulations

All around the country, Americans are speaking up and telling the EPA to slow down on proposed regulations. The Midwest is no exception.

As explained in an article from Reuters, the Midwest Independent System Operator, an electric grid operator in parts of 12 U.S. states in the Midwest, could be forced to shut off about 13,000 megawatts of coal-fueled generation—a move that would increase energy prices and threaten the reliability of electricity

Clair Moeller, MISO’s Vice President of Transmission Asset Management, told Reuters that MISO and other regional grid operators have asked the EPA for changes in these rules. To ensure power systems stay stable, generators and operators need more time to comply with rules.

“That is not enough time. It takes three or four years to retrofit or replace a power plant. We are worried about the nightmare of 62,000 MW going out at the same time,” Moeller said, noting most of the coal units would not retire but would still need to be shut for months …

In other words, the EPA needs to slow down.

The Truth About EPA Regulations and Coal Plant Retirements

In the ongoing discussion about proposed EPA regulations on power plants, there are some who claim that these regulations won’t directly require the shutting down of any specific plants.  Some also claim that the agency’s role of setting rules and standards on emissions is separate from businesses having to make decisions about whether or not to invest in existing power plants.

While the EPA might not target individual power plants for closure, the facts show that new proposed EPA regulations will dramatically decrease an important source of our baseload power by increasing retirements of coal-fueled power plants. According to a recent study from the National Economic Research Associates that we commissioned, under four proposed EPA regulations, there would be 42.2 gigawatts of coal-fueled power plants that would be retired from 2012 to 2020, compared to just 3.1 gigawatts of retirements without those four new rules. Those 39.1 gigawatts of additional retirements represent about 12 percent of the 2010 U.S. coal-fueled electricity generating capacity.

While it’s important to have a balanced energy portfolio that takes advantage of all forms of energy, policies shouldn’t force electricity providers to switch off of this country’s most affordable and abundant energy source, which could lead to increased energy costs for American families and job creators. According to the NERA study, EPA regulations that decrease coal-fueled electricity and increase natural gas-fueled electricity would increase natural gas prices by 10 percent from 2012 to 2020, leading to $8 billion in additional costs annually for residential, commercial and industrial consumers.

What’s most troubling is that the EPA has admitted to not analyzing all the negative economic impacts of their proposed regulations, including Utility MACT, the most expensive rule the EPA has ever written for coal-fueled power plants.

Share this post with friends and family on Twitter and Facebook using the buttons above. It’s important to spread the word about the consequences of these rules on the American economy.

Frequently Asked Questions About Proposed EPA Regulations

On the presidential campaign trail, throughout Capitol Hill, and in your neighborhoods there’s been a lot of discussion and debate on how America should move forward with energy policy.  Currently, a lot of those discussions center around whether or not proposed EPA regulations would affect our economic and energy security.

Within that discussion and debate, there have been a lot of myths tossed around about proposed EPA regulations. We want to lay out the facts about how these potential rules would affect Americans.

Question #1: Won’t EPA regulations create jobs?

No. When looking at how EPA regulations affect employment, it’s important to look at the cumulative effects of those rules. When NERA conducted the analysis of four proposed EPA regulations, they took into account sectors that would gain jobs or lose jobs:

[S]ectors that would gain jobs account for about 55,000 added jobs per year on average, and sectors that would lose jobs account for about 238,000 fewer jobs per year on average.

In total, these proposed rules would lead to a net employment loss of 1.65 million jobs from 2012 to 2020.

Question #2: Could these proposed EPA regulations really increase the likelihood of blackouts?

Yes. In addition to lost jobs and higher energy prices, a large number of premature retirements of coal-fueled power plants due to these proposed rules could increase the risk of blackouts. The Wall Street Journal’s editorial board pointed out earlier this week that the EPA could be ignoring the threats proposed regulations have on the reliability of our electricity:

Congressional and industry investigators … uncovered one 934-page EPA draft that was circulated within the Administration sometime before the utility rule was formally proposed. In a “What are the energy impacts?” section, the EPA concedes that it “is aware that concerns have been expressed by some, even in advance of this proposed rule, that this regulation may detrimentally impact the reliability of the electric grid.” … But here’s the kicker: This reliability section was gone when the EPA released its utility rule proposal in May 2011.

Utility commissioners and attorneys general from several states, as well as former and current elected officials from both parties, have all said that some of these proposed EPA regulations could decrease power capacity while limiting energy provider’s ability to fulfill increased demand times.

Question #3: Don’t we need these proposed EPA regulations to switch from coal to newer, cleaner sources of energy?

No. First, coal-fueled power plants have already invested almost $100 billion to significantly reduce emissions without new EPA rules, and will invest $125 million through 2015 to reduce emissions further. Over the past four decades, investments in advanced coal technologies have reduced emissions of three major air pollutants by 84 percent per unit of electricity generated, even though America’s population, economy and energy use have all grown significantly.

Second, these proposed regulations would prematurely shut down more than 39,000 megawatts of coal-fueled power plants, increasing electricity costs by double digits in many regions of the U.S. and increasing natural gas costs by $8 billion per year for residential, commercial and industrial consumers.

So take a stand on these EPA regulations and write your elected official today.

Coal Brings Economic Growth in Louisiana, Arkansas

The Mobile Classroom recently wrapped up a trip to Arkansas and Louisiana, ending with a few days at the Louisiana State Fair in Shreveport. Coal is important to Louisiana and Arkansas by providing a lift to the economy, while helping to keep electricity rates low.

After visiting the classroom at the fair, Louisiana resident Justin Waldrup said, “Economic growth is definitely needed around these parts.  If it comes with the added bonus of using coal, then I’ll take that!”

Residents aren’t the only ones who note the importance of coal in these states. Louisiana’s Natchitoches Parish Commissioner Tony Davis visited the classroom, where he noted the importance of coal. “Most people do not know just how much coal affects our economic climate in Louisiana,” said Davis.

That’s why the John W. Turk, Jr. Plant will be such an asset to this area: jobs and affordable electricity. When it’s complete in 2012, the plant will use state-of-the-art technology to be one of the cleanest, most efficient coal-fueled plants in the United States. By the time it is completed, the plant will have supported at least 1,500 construction jobs, and when it’s up and running, it will provide stable electricity to more than 500,000 residents.

Keep up-to-date with the Turk Plant’s progress here.

Who’s Speaking Out Against Proposed EPA Regulations?

The Utility MACT rule gaining the attention of prominent former and current federal elected officials who are concerned about the impact this and other rules would have on our economic and energy security.

Earlier this week, former Sen. Evan Bayh (D-Ind.) wrote in The Indianapolis Star about Utility MACT putting the Hoosier State’s economy in jeopardy:

[Utility MACT] will put tens of thousands of jobs in our state directly at risk by affecting Hoosiers’ utilities that rely on coal-fired power to keep our lights on and manufacturing facilities working. Even though the electric utility industry has invested billions of dollars over the past two decades to reduce emissions, the Utility MACT Rule orders coal-fired utilities to spend additional billions on retrofitting technologies to decrease the amount of emissions released as a production byproduct. Power plants that cannot reasonably afford these compliance costs will have to shut down and be replaced in a short timeframe by new generation and transmission at substantial cost to consumers.

Bayh also expresses his concern about the EPA’s lack of analysis when it comes to these impacts:

There has been a serious lack of meaningful coordination between the EPA and the Energy Regulatory Commission to determine how the Utility MACT Rule impacts reliability and generation capacity. This oversight should give the EPA pause before continuing as planned. Regulations that affect the livelihoods of millions of Americans deserve thorough and complete analysis before their implementation.

This is why Sen. Lisa Murkowski (R-Ala.) asked the EPA two months ago to delay implementation of the Utility MACT rule until a full analysis is provided of the rule’s impact on electricity reliability:

We must consider the total impact this rule will have on the electric grid. The reliability of the grid has a direct impact on the quality and cost of electricity, which in turn affects Americans’ ability to affordably power and heat their homes …

This month, former Sen. Blanche Lincoln (D-Ark.) also expressed her concern in Politico about the lack of economic impact analysis of many regulations, including those from the EPA:

Regulators should estimate the long-term benefits and costs of new regulations using the best available economic models and adopt only those regulations that impose the least burden on the economy at large. Regulatory agencies often highlight indirect benefits of regulatory proposals, but should analyze and make public the indirect costs to consumers. In addition, the collective effects of more and more regulations on small businesses must be considered.

The third of our five facts about Utility MACT makes these officials’ point simply: EPA itself has stated that economic and energy security impacts were not considered when drafting the regulation. That’s why you should take a stand on Utility MACT and write your elected official.

Mobile Classroom Visits Arkansas and Louisiana

The Mobile Classroom is back on the road, and for this stint, the team is stopping throughout Arkansas and Louisiana. On its tours, the Mobile Classroom gives participants a firsthand look at the technology and a detailed understanding of the recycling of coal byproducts.

One of the most state-of-the-art advanced coal-based power plants being constructed right now is the John W. Turk, Jr. Power Plant in Southwest Arkansas. When it opens in 2012, the plant will create efficient electricity and provide 110 permanent jobs. During construction, the plant is supporting 1,900 construction jobs. Ultimately, when it’s up and running, the Turk Plant will generate electricity for 500,000 Arkansans. It’s important that residents of this region know and understand the impact that coal-based electricity has on their economy and electricity rates.

Also this week; geologists, chemical engineers, energy representatives and students learned more about this efficient coal-owered technology when they toured the Mobile Classroom at the Arkansas Environmental Federation’s Annual Convention and Trade show. Attendees from SWEPCO and the Arkansas Coalition for Affordable and Reliable Energy (ACARE) learned about specifics on creating affordable energy from increasingly efficient coal-fueled technology. EPA regional administrator Al Armendariz toured the classroom, and stressed the importance of informing the public about affordable energy and jobs through the implementation of clean coal technology.

If you want to help promote reliable electricity in Arkansas, join ACARE and find them on Facebook.