Abby L. Harvey
GHG Monitor
9/26/2014
The Environmental Protection Agency may have “missed the boat” in terms of crediting states who have taken early action to reduce carbon emissions in their proposed carbon emission standards for existing coal-fired power plants, some state and utility officials said during a panel discussion hosted by the Bipartisan Policy Center this week. The proposed regulation sets carbon emission reduction targets for each state and mandates that each state develop an action plan to meet those guidelines. The proposed regulations, however, do not give enough credit to states that have already acted to reduce their emissions and may in some cases penalize those states, some panelists said.
David Thornton, Assistant Commissioner with the Minnesota Pollution Control Agency, said that Minnesota has a long history of trying to lower carbon emissions, noting the state’s renewable energy standards, significant investments in energy efficiency, a state goal for reducing greenhouse gases and the development of state statutes encouraging utilities to voluntarily pursue emission reduction projects. However, because these actions were taken before 2012, the year which EPA used to develop their targets, the state doesn’t really benefit from its proactive actions. “When you draw your baseline at 2012 you don’t get any credit for the actions that you’ve taken before that and so our utilities that have spent a lot of money and a public utilities commission that is looking out for ratepayers is concerned that our ratepayers have invested in this and they should get a little more return for their investment," Thornton said.
Nuclear is also mismanaged in the plan, said Ray Harry, Senior Director for Governmental Affairs with Southern Company. "In our case for Southern Company new nuclear, being nuclear under construction, is one that we have scratched our heads and think that EPA maybe missed the boat in terms of how they handled that,” he said. Southern Company is in the process of building two new nuclear units in Georgia that are not expected to come on-line until 2017 and 2018, but the regulation treats the units as if they are already contributing to Georgia’s energy mix. "In our case it makes more sense to not include those units in terms of setting a target, certainly you want to be able take the credit and use it toward compliance, because nuclear is the largest zero carbon emitting source in the country," Harry said.
Does the Clean Air Act Allow for Rewards?
Megan Ceronsky, Director of Regulatory Policy and Senior Attorney with the Environmental Defense Fund, defended the EPA’s treatment of early action somewhat, explaining that "what the EPA has done here, under the structure of the Clean Air Act is said, ‘We’ve identified this best system of emissions reductions and we’ve applied it to each state.’ Applying it to each state meant, in their minds, that we’re looking at the existing infrastructure and what we see as the emissions reduction opportunities in each state based on that existing infrastructure,” Ceronsky said. “So, for renewables it means we look at where you were in 2012 and the potential for you to ramp up and anything that is in the ground that is renewable energy is coming towards compliance, but we’re looking at potential for you to move from where you are today towards your potential under this regional averaging of renewables policies."
Ceronsky went on to explain that states are not necessarily being penalized for taking action early, but they aren’t really being rewarded either. “The analysis recognizes where states are today. States are not being asked to sort of re-do what they have already done,” she said. “It also means if you’re ahead of the game you’re closer to that sort of full potential than other states are, which does mean in the context of this analysis over the long-long term, you’ll get there sooner than other people will, to the full deployment of the best system of emission reduction, but that’s doesn’t necessarily feel like a reward to states and companies that have acted early. It’s not clear that the Clean Air Act allows for rewards."
