June 26, 2013

Obama's new energy policy: War on climate change or war on coal?

Coal is in the crosshairs as the president proposes new regulations to limit carbon dioxide in the air.

By SEAN COCKERHAM and ERIKA BOLSTAD / McClatchy Washington Bureau

click image to enlarge

Coal power plants like this one La Cygne, Kan., could face more stringent regulations under proposals unveiled by President Obama on Tuesday.

The Associated Press

EFFECT OF REGULATIONS UNCLEAR FOR MAINE

President Obama's announcement Tuesday of plans to combat climate change by reducing greenhouse gas emissions from power plants received mixed reviews from Maine's congressional delegation.

But it remained unclear Tuesday how any federal directive could affect -- or interact with -- the cap-and-trade program already in place for power plants in Maine and other northeastern states that is often described as a potential model for a national system.

Although Obama's proposal takes a broad approach to climate change, the part that drew the most attention was the memo that the president directing the Environmental Protection Agency to begin developing standards to regulate greenhouse gas emissions from power plants that burn fossil fuels. If enacted it would be the first federal regulations for carbon dioxide on existing power plants.

Maine and 10 other northeastern states already took similar action when they formed the Regional Greenhouse Gas Initiative, which is capped carbon emissions from power plants and then required them to purchase credits for each ton on carbon they emit. Those credits are then traded on a carbon market like other commodities.

The Obama administration's memo directs the EPA to work cooperatively with states -- as well as power production industry -- to develop "flexible" standards. But the memo does not specifically address regional climate change initiatives such RGGI.

The president plans to direct that the EPA begin outreach to states and other stakeholders about the design of the program to develop "common-sense approaches" to limit carbon pollution from existing power plants.

Dylan Voorhees, who handles climate change issues for the Natural Resources Council of Maine, said he expects any federal standards will likely work with the RGGI system for Maine and other participating states. But those details will have to be worked out as the rules are developed, he said.

"This is a very ambitious [unveiling] of what will be a federal rule-making process, so there really is a lot of work to be done before those issues are decided," Voorhees said.

Maine Sen. Susan Collins, a Republican, said she preferred a legislative approach. She also said development of renewable energy would help Maine while reducing carbon emissions.

"Climate change is a significant environmental challenge that requires global solutions in order reduce greenhouse gas pollution worldwide," Collins said in a statement. "However, I continue to believe that the best course forward is for Congress, not unelected government officials at the EPA, to set this policy framework."

U.S. Rep. Mike Michaud, D-District 2, appeared to support the proposals.

"I'm still reviewing the plan and reaching out to stakeholders in Maine, and I know that the devil is always in the details," Michaud said in a statement. "But it appears to me that the president's plan makes concrete progress on reducing pollution, addressing climate change, and growing our clean energy sector."

Rep. Chellie Pingree, D-District 1, expressed support for the president's plan.

"Maine and other northeastern states have already taken the lead by reducing and regulating greenhouse gas pollution from power plants as part of the Regional Greenhouse Gas Initiative so it will be good to have a national approach to this pollution, which will ensure that Maine is on a level playing field with the rest of the country," Pingree said in a statement.

 

– Kevin Miller, Washington, D.C., bureau chief

President Obama's plan to curb climate change could transform American energy, potentially dealing a blow to the coal-fired power plants that supply much of the nation's electricity but also pump planet-warming gases into the atmosphere.

Obama rolled out his long-awaited plan in a speech Tuesday that outlined broad goals but left the specifics to be worked out over the coming months.

"The question now is whether we will have the courage to act before it is too late," he said in a speech at Georgetown University. "And how we answer will have a profound impact on the world we leave behind, not just to you but to your children and your grandchildren."

The president signaled for the first time that he will block the controversial Keystone pipeline if it's shown that it would worsen climate change. Keystone would tap Canadian oil sands that produce more greenhouse gases than other sources, but the State Department downplayed the climate impact in a highly disputed report. "The pipeline's impact on our climate will be absolutely critical in determining whether this project will go forward," Obama said.

The overall plan the president rolled out calls for boosting renewable energy and efficiency standards for appliances and federal buildings, and preparing the nation for the extreme weather impacts of a changing planet.

The centerpiece of Obama's blueprint is his promise to limit the greenhouse gas emissions of America's power plants. The plants produce an estimated 40 percent of the nation's carbon dioxide emissions that scientists link to global warming.

His proposed new regulations could increase utility costs for American consumers and harm regional economies tied to coal, which generates about 37 percent of all U.S. electricity.

Coal state senators called the proposed regulations a "war on coal" that would hurt the economies and jobs in their states and the entire country.

"Declaring a 'war on coal' is tantamount to declaring a 'war on jobs.' It's tantamount to kicking the ladder out from beneath the feet of many Americans struggling in today's economy," said Sen. Mitch McConnell, R-Ky., the Senate minority leader.

"Removing coal from our energy mix will have disastrous consequences for our recovering economy," said Sen. Joe Manchin, D-W.Va. "These policies punish American businesses by putting them at a competitive disadvantage with our global competitors. And those competitors burn seven-eighths of the world's coal, and they're not going to stop using coal anytime soon."

Kevin Book, an analyst at Washington-based ClearView Energy Partners, said it was reasonable to assume that Obama's climate change policies would lead to marginally higher bills for utility customers.

"Cleaner is almost always more expensive," Book said. "But clean is not usually as expensive as initially feared."

New carbon pollution limits, combined with previously announced mercury rules, could mean a major wave of coal-fired power plant closures over the next decade, Book said. The Obama administration already has been working on carbon pollution rules for new coal-fired plants that could mean that few, if any, of those are built, Book said.

Jeff Holmstead, who represents utility clients at the Washington law firm Bracewell and Giuliani, said it wasn't clear how far the Environmental Protection Agency could go legally in limiting greenhouse gases.

It's too soon to tell what impact Obama's plan may have, he said. "There was no substance at all to the president's proposal, he just said, 'EPA, go develop a regulation on a certain timetable,' " Holmstead said.

The Natural Resources Defense Council estimates that it would cost at least $4 billion for utilities to comply with new regulations. The environmental group estimates as much as $25 billion to $60 billion in benefits, however, including the health benefits of switching to energy sources that produce less soot.

Obama said criticism of his plan as a job-killer showed a lack of faith in American business and ingenuity. A low-carbon energy economy can drive growth, he said, and the nation must tackle climate change.

"We don't have time for a meeting of the flat earth society," he said. "Sticking your head in the sand might make you feel safer but it's not going to protect you from the coming storm."

The president left the details to be settled later. He's directing the EPA to work with states and industry to set the new pollution standards. He wants the rules finalized by June 2015.

 

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