Proposed EPA Rule Poses Threat To Power Grid
ARRA Editor: While the below article addresses the EPA's Threat to the Arkansas power grid, the same is true across much of the United States. The EPA's implementation of the Presidents war on coal is significant to all. President Obama said on January 17, 2008, "So if somebody wants to build a coal-powered plant, they can ... it's just that it will bankrupt them." Under the EPA's proposed rules and continuous actions, the same can be said for existing coal-powered plants which provide critically needed electricity especially to rural America.
by Sheila Yount, Editor, Arkansas Living: The Environmental Protection Agency’s (EPA) proposed rule limiting carbon dioxide emissions from the nation’s power plants could threaten the reliability of the power grid, a representative of the Southwest Power Pool told state policymakers on Aug. 28.
“I don’t want to sound like the sky is falling , I am just saying that we ought to be concerned about the reliability impacts and we ought to ensure that those will be resolved,” said Lanny Nickell, vice president of engineering for the Southwest Power Pool, which operates the power grid for nine states, including part of Arkansas.
Nickell’s comments came during a stakeholders meeting at the Arkansas Department of Environmental Quality of fices in North Little Rock. The stakeholders, who include representatives of the state’s electric utility industry and environmental groups, as well as state regulators, began meeting in June to discuss issues related to the state’s compliance with the proposed EPA rule, which is part of President Obama’s Clean Power Plan. The plan was launched in early June and the EPA is taking comments on the rule through Dec. 1. The original comment due date was Oct. 16, but the EPA announced on Sept. 16 that it would extend it by 45 days.
The rule, which is expected to be finalized in June 2015, seeks to reduce the CO2 emissions from power plants in the U.S. by 30 percent from 2005 levels by 2030. Arkansas’ target is even higher at 44 percent, while surrounding states’ proposed requirements are not as stringent.
Nickell began his comments by referring to the major two-day power blackout that occurred in August 2003 across parts of the Northeast and Midwest of the U.S. and portions of Canada. He said the blackout, which occurred after transmission overloads took about 60,000 megawatts of power offline, caused 11 deaths and cost about $10 billion. Because of the possibility of similar events, Nickell said SPP is concerned about potential reliability implications of the proposed EPA rule.
To comply with the rule, Nickell said the EPA assumes that some fossil-fueled plants, mostly coal, would have to be retired, beginning around 2020. Without building new generation to replace it, Nickell said SPP would be short about 4,500 megawatts of generation needed to meet minimum capacity reserves in 2020, and by 10,000 megawatts in 2024.
Nickell noted that today’s current power grid is reliable, but he said it only takes “one uninformed decision to cause problems on the system.” He said SPP needs good information to help it plan for the future to ensure that the power grid remains reliable. But with the proposed EPA rule, he said the “future is cloudy,” which makes planning difficult.
“We have more work to do on our reliability assessment, but we know enough to be concerned, and we know enough that we are prepared and will be making comments to the EPA along the lines of please allow the time to ensure that these regulations can be complied with in a reliable fashion,” Nickell said.
More time needed
Duane Highley, president and chief executive officer of Arkansas Electric Cooperative Corporation, (AECC), also told the group that more time is needed to comply with the proposed rule. The EPA has called its plan a “glide path,” because all of the reductions would not have to be made until 2030. But Highley said the timetable requires too much, too soon.
“We say that is not much of a glide path; it is more of a crash landing because we effectively have to make our full compliance effort by the year 2020 or, at the very latest, 2021, in order to average a 41 percent reduction level for that entire period,” Highley said. “So, we don’t have much time to make some pretty big changes in how we both generate and use electricity.” Highley said Arkansas has a 44 percent by 2030 C02 reduction target not because it has more CO2 emissions than surrounding states, but because it has a more diverse supply of generation.
“We have the ability to shift generation to natural gas,” he said, adding that Arkansas is, in effect, being punished for having well planned generation resources.
To meet that stringent target, Highley said “it is very likely” that at least two of the state’s major coal-based power plants would have to close, creating adverse economic impacts for the state and the communities where those plants are located. Studies show about 1,200 jobs would be lost with the closure of the White Bluff Steam Electric Station at Red field with a loss of about $600 million to the economy. The closure of the Independence Steam Electric Station at Newark would have a similar impact, Highley said, adding that both of these plants are located in some of the highest areas of unemployment in Arkansas.
As for increased costs, Highley said AECC, which supplies wholesale power to the state’s 17 electric distribution coops, estimates the rule would cost co-ops an additional $74 million a year by 2020, which would increase to $184 million annually in 2030. For the average residential co-op member, the increase in electric bills would range from about $150 to $450 a year, he said, adding that some people argue that those costs are not problematic.
“I get pretty ticked off when some people say that the money they would spend on the increased electric bill isn’t that big of a deal,” Highley said. “I hear this from policymakers, who sit in their air conditioned office, typing their blog on their electri fied computers and don’t think about the little old lady at the end of the line who is struggling to pay her bill today.”
An increase of 20 to 40 percent on some co-op members’ bills could force them to refrain from running their air conditioners in the summer, which Highley said could lead to heat-related illness and death, especially among the elderly.
Representatives of other stakeholders also commented, including Dan Byers, senior director for policy with the U.S. Chamber of Commerce, who warned that the rule could lead to increased electricity prices and lost jobs. Todd Hillman, south region vice president of the Midcontinent Independent System Operator (MISO), which operates the power grid in 15 states, including much of Arkansas, said MISO is doing an analysis of the rule’s potential impact. Al Armendariz, a senior campaign representative for the Sierra Club’s Beyond Coal Campaign, spoke in favor of the rule.
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Sheila Yount is the Editor for the Arkansas Electric Cooperatives Inc. publications including Arkansas Living. She is also Youth Tour Director at the Electric Cooperatives of Arkansas.
Tags: EPA, EPA rule, threat, power grid, war on coal, Arkansas Living, Sheila Yount To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. and "Like" Facebook Page - Thanks!
“I don’t want to sound like the sky is falling , I am just saying that we ought to be concerned about the reliability impacts and we ought to ensure that those will be resolved,” said Lanny Nickell, vice president of engineering for the Southwest Power Pool, which operates the power grid for nine states, including part of Arkansas.
Nickell’s comments came during a stakeholders meeting at the Arkansas Department of Environmental Quality of fices in North Little Rock. The stakeholders, who include representatives of the state’s electric utility industry and environmental groups, as well as state regulators, began meeting in June to discuss issues related to the state’s compliance with the proposed EPA rule, which is part of President Obama’s Clean Power Plan. The plan was launched in early June and the EPA is taking comments on the rule through Dec. 1. The original comment due date was Oct. 16, but the EPA announced on Sept. 16 that it would extend it by 45 days.
The rule, which is expected to be finalized in June 2015, seeks to reduce the CO2 emissions from power plants in the U.S. by 30 percent from 2005 levels by 2030. Arkansas’ target is even higher at 44 percent, while surrounding states’ proposed requirements are not as stringent.
Nickell began his comments by referring to the major two-day power blackout that occurred in August 2003 across parts of the Northeast and Midwest of the U.S. and portions of Canada. He said the blackout, which occurred after transmission overloads took about 60,000 megawatts of power offline, caused 11 deaths and cost about $10 billion. Because of the possibility of similar events, Nickell said SPP is concerned about potential reliability implications of the proposed EPA rule.
To comply with the rule, Nickell said the EPA assumes that some fossil-fueled plants, mostly coal, would have to be retired, beginning around 2020. Without building new generation to replace it, Nickell said SPP would be short about 4,500 megawatts of generation needed to meet minimum capacity reserves in 2020, and by 10,000 megawatts in 2024.
Nickell noted that today’s current power grid is reliable, but he said it only takes “one uninformed decision to cause problems on the system.” He said SPP needs good information to help it plan for the future to ensure that the power grid remains reliable. But with the proposed EPA rule, he said the “future is cloudy,” which makes planning difficult.
“We have more work to do on our reliability assessment, but we know enough to be concerned, and we know enough that we are prepared and will be making comments to the EPA along the lines of please allow the time to ensure that these regulations can be complied with in a reliable fashion,” Nickell said.
More time needed
Duane Highley, president and chief executive officer of Arkansas Electric Cooperative Corporation, (AECC), also told the group that more time is needed to comply with the proposed rule. The EPA has called its plan a “glide path,” because all of the reductions would not have to be made until 2030. But Highley said the timetable requires too much, too soon.
“We say that is not much of a glide path; it is more of a crash landing because we effectively have to make our full compliance effort by the year 2020 or, at the very latest, 2021, in order to average a 41 percent reduction level for that entire period,” Highley said. “So, we don’t have much time to make some pretty big changes in how we both generate and use electricity.” Highley said Arkansas has a 44 percent by 2030 C02 reduction target not because it has more CO2 emissions than surrounding states, but because it has a more diverse supply of generation.
“We have the ability to shift generation to natural gas,” he said, adding that Arkansas is, in effect, being punished for having well planned generation resources.
To meet that stringent target, Highley said “it is very likely” that at least two of the state’s major coal-based power plants would have to close, creating adverse economic impacts for the state and the communities where those plants are located. Studies show about 1,200 jobs would be lost with the closure of the White Bluff Steam Electric Station at Red field with a loss of about $600 million to the economy. The closure of the Independence Steam Electric Station at Newark would have a similar impact, Highley said, adding that both of these plants are located in some of the highest areas of unemployment in Arkansas.
As for increased costs, Highley said AECC, which supplies wholesale power to the state’s 17 electric distribution coops, estimates the rule would cost co-ops an additional $74 million a year by 2020, which would increase to $184 million annually in 2030. For the average residential co-op member, the increase in electric bills would range from about $150 to $450 a year, he said, adding that some people argue that those costs are not problematic.
“I get pretty ticked off when some people say that the money they would spend on the increased electric bill isn’t that big of a deal,” Highley said. “I hear this from policymakers, who sit in their air conditioned office, typing their blog on their electri fied computers and don’t think about the little old lady at the end of the line who is struggling to pay her bill today.”
An increase of 20 to 40 percent on some co-op members’ bills could force them to refrain from running their air conditioners in the summer, which Highley said could lead to heat-related illness and death, especially among the elderly.
Representatives of other stakeholders also commented, including Dan Byers, senior director for policy with the U.S. Chamber of Commerce, who warned that the rule could lead to increased electricity prices and lost jobs. Todd Hillman, south region vice president of the Midcontinent Independent System Operator (MISO), which operates the power grid in 15 states, including much of Arkansas, said MISO is doing an analysis of the rule’s potential impact. Al Armendariz, a senior campaign representative for the Sierra Club’s Beyond Coal Campaign, spoke in favor of the rule.
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Sheila Yount is the Editor for the Arkansas Electric Cooperatives Inc. publications including Arkansas Living. She is also Youth Tour Director at the Electric Cooperatives of Arkansas.
Tags: EPA, EPA rule, threat, power grid, war on coal, Arkansas Living, Sheila Yount To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. and "Like" Facebook Page - Thanks!
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