Business/Economy, Energy, Environment, Featured, Politics

EPA power plant rule will hurt Colorado ratepayers

It is virtually impossible to overstate the importance of readily available access to safe, affordable and reliable energy to individual prosperity and economic well-being. Energy impacts nearly all aspects of life, from the gasoline pumped into cars to the electricity needed to power factories and industries.

Consequently, any federal environmental regulations created and imposed by bureaucrats from Washington, D.C. will have far reaching impacts.

icon_op_edThe latest in a long line of overly burdensome and redundant regulations was put forward by the Environmental Protection Agency in early June of this year. The EPA’s proposed Clean Power Plan would require a 30 percent reduction in nationwide carbon dioxide emissions from power plants relative to 2005 levels.

On the surface, this may sound like a positive development, especially since greenhouse gas emissions, including carbon dioxide, are a primary cause of global climate change. The reality, however, is that the EPA’s new rule would offer a whole lot of pain for relatively little gain.

If finalized, the EPA’s proposal could cause tremendous harm to the economy by raising electricity prices and causing significant job losses. By the EPA’s own estimates, electricity prices nationwide would increase by an average of between 6 and 7 percent and up to 12 percent in some locations. Furthermore, the United Mine Workers of America estimate that by 2035, the total cumulative direct and indirect job losses in the utility, rail and coal industries will top 4.2 million jobs lost as a result of the proposal. It should be noted that jobs in these three industries are typically high-wage, high-skilled positions.

The proposed rule also presents significant reliability concerns that could lead to rolling brownouts and blackouts becoming the norm. According to the EPA’s own predictions, approximately 120 gigawatts of baseload coal generation could be forced into retirement by 2020 as a result of this proposed rule and existing EPA regulations. This is roughly the amount of electricity needed to power 60 million homes. In Colorado, for example, the EPA expects three plants—Arapahoe, Cherokee, and Valmont—to be retired by 2020. The amount of power these three stations generate is enough to power 325,000 homes under normal conditions.

To be compliant with the rule, the EPA would expect states to increasingly rely on intermittent sources, such as wind and solar, to generate electricity. While these two sources each have their place in the nation’s fuel generation mix, neither can currently produce the baseload power that coal, natural gas and nuclear can.

One would think that with the significant sacrifices the EPA is expecting the country to make, there would be a great deal of benefit to their plan, such as global temperature increases that will be averted as a result of reduced carbon dioxide emissions. However, in neither the 654-page proposal nor the 376-page regulatory impact analysis does the EPA explain the climate benefits of the proposed rule. If the plan is fully implemented, the amount of carbon dioxide emissions would offset the equivalent of just over 13 days of emissions from China. Any amount of averted global temperature increases would be largely imperceptible.

In short, a simple analysis of the Clean Power Plan suggests that the costs would far outweigh any benefits. Unless modified significantly, the proposed rule would put at risk the competitive advantage that affordable and reliable energy provides to the economy and will needlessly cause hardship, especially for those on low and fixed incomes. In what has become an all too common theme, however, this does not seem to concern the Washington bureaucrats.

Jerry Sonnenberg represents District 65 (northeastern Colorado) in the Colorado House of Representatives.


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