PACE’s Official Statement to EPA

Today, in Atlanta, PACE will deliver the following statement to EPA officials regarding the agency’s new carbon dioxide regulation. Read the statement online here.

Representatives of EPA, I am here today representing more than twenty partners across the Southeast. Many of these are involved in manufacturing and trade. Others in farming and agribusiness. Still others are small businesses making their way in a tough economy. Some are simply families who want to keep the lights on at an affordable price.

Screen Shot 2014-07-28 at 10.07.20 AMThe common bond among all of the organizations that are part of our coalition is that each will be affected negatively by the new carbon dioxide regulation proposed by EPA. The rule will raise the price of electricity. The rule will make our nation’s energy portfolio less diverse and, by definition, diminish the strong foundation of stability we have built. The rule will make the price of electricity more volatile by forcing utilities to use more natural gas. These are the things the rule will do, and we believe that a careful examination of the available data, as opposed to biased hope or belief, will lead reasonable thinkers to the same troubling conclusions.

There are things, however, that the rule will not do. Although EPA has sold its regulation of carbon dioxide to the American public as a climate change measure, the truth is that the agency’s mandate of reducing CO2 from the power sector by 30% by the year 2030 is about political posturing, not real climate results. The agency’s chief, Gina McCarthy, even admitted this fact in testimony to the House of Representatives in September of 2013. When asked if EPA’s regulation of carbon dioxide would cause any measurable change in the agency’s 26 indicators of climate change, Administrator McCarthy said they would not. Rather, she explained, a carbon rule only works if other nations adopt the same policies. She rationalized that the administration’s carbon dioxide regulation “positions the U.S. for leadership.” In short, this rule is only leverage.

This is not the message EPA has sent to the American public. If Americans truly realized that their government was trading affordable power prices and a strong and stable electricity portfolio only for political leverage, they would not support this rule. In fact, they would be angry, and disappointed, and wondering why the executive branch has made such a terrible bargain.

The U.S. Chamber of Commerce has estimated that this rule will raise the price of electricity as much as 40% and cost more than 200,000 jobs. Just as important, the rule will speed the closure of coal-fired power plants in the U.S., forcing another 114 gigawatts of generation off the grid. Philip Moeller of FERC puts it in the simplest possible terms: “If you take enough supply out of the system, the price is going to increase.”

The agency’s MATS rule is already taking sixty gigawatts of generation off the grid next year. Mr. Moeller says that these rapid shocks to our energy supply could cause brownouts or even blackouts. Meanwhile, the rest of the world will use U.S. coal to produce more than six additional tons of carbon for every one ton we reduce under this rule.

The bottom line is that the earth’s temperature will not change because of this rule, but power bills will.

On behalf of our partners, we ask the EPA to abandon this irrational approach to addressing climate change and focus instead on more reasonable measures that deliver real results.


In Florida, Buzz Words Drowning Out the Real Debate

What happens when the merits of an argument fail? Change the subject. Blame someone. Or simply deflect attention from the possibility that maybe your approach isn’t the best one out there.

Those seem to be the preferred strategies of renewable energy blogger Brian Holton Henderson in a recent opinion piece in the Huffington Post. Unhappy with the pace of his vision for Florida, Henderson blames the usual suspects: the big utilities, regulators, and vague notions of cronyism. The most obvious explanation, of course, is that the vision of Henderson’s environmental left is bad for most customers. That explanation also happens to be true.

In his piece, Henderson laments that more Floridians have not installed rooftop solar panels, arguing that state government should do more to help cultivate Florida’s residential solar market. More government policy and greater public subsidy for solar are needed, says Henderson. Maybe even a renewable portfolio standard to strong arm utilities into procuring more solar power.

Rather than consider that such policies aren’t in the best interest of customers, Henderson alleges that “utilities have launched an unfolding offensive against the burgeoning renewable energy industry.” The article he uses to demonstrate that point? It doesn’t mention a utility effort at all, but a nationwide campaign by the American Legislative Exchange Council to point out that state policies on rooftop solar power often place additional burden on the backs of non-solar customers. PACE argued the same in an August 2013 white paper on Arizona’s net metering policy. A representative of NAACP just recently echoed that argument in a July 21st Florida Public Service Commission hearing on solar rebates and energy efficiency.

What Henderson calls an “unfolding offensive” is, in truth, a chorus of voices describing the built-in inequity of the sorts of solar policies Henderson admires. The message is simple. Customers who can’t afford to install expensive solar panels shouldn’t be forced to pay more to subsidize a select few customers who can. The real offensive being launched is by the acolytes of the solar movement, who seem to care little about confronting the faulty economics that underpin their preferred industry. There are sensible ways to deploy more solar power, of course, but voices like Henderson are far more focused on the speed of solar’s expansion, not whether it creates casualties in the form of low- and middle-income power customers.

While Henderson is free to scream cronyism and wrap himself in the banner of transparency, his approach to creating better energy policy in Florida would benefit from acknowledging a simple reality: the adoption of rooftop solar in Florida is modest because those systems are expensive. Without subsidies from utilities and other unwitting power customers, rooftop solar is a far less attractive bargain. It is a lesson that governments in Germany, Spain, and a handful of other European nations have learned the hard way. Everyone wants solar when someone else is helping to pay for it.

Pinning blame on big corporations and taking shots at regulators is easy. What is more difficult, but ultimately more fruitful, is to work through the political process toward solutions that work for everyone in the long run. That approach might not make great headlines, but it does yield good policy. And in the end, it might not make Florida number one in solar, but it will ensure its Public Service Commission doesn’t choose what is best for a small vanguard of pro-solar activists over what is best for most of the people who call it home.


Kemper County Plant Passes Important Milestones

In recent months, PACE has continued to monitor developments at a new power plant in Kemper County, Mississippi, that will use state-of-the-art technology to convert native lignite coal into synthetic gas . The Kemper County Energy Facility, which represents an important step in the future of coal-fired power generation, has now achieved two major milestones, according to information released recently by Mississippi Power.

According to the company, plant officials completed the pneumatic tests on the gasifiers used to convert lignite to synthetic gas. This technology allows the plant’s emission footprint to resemble that of a natural gas plant. Officials also successfully tested the combined cycle unit responsible for generating electricity. Combined cycle technology has proven to be among the most efficient ways to generate electricity on a commercial scale.

The pneumatic tests ensure the gasifiers – a centerpiece of the new technology – can hold pressure. The gasifiers process the lignite coal from the adjacent mine and convert it to synthetic gas, using a chemical process as opposed to the more typical combustion. This chemical conversion renders the fuel for the combined cycle unit.

“The Kemper plant has moved one step closer to demonstrating that we can use homegrown, American ingenuity to meet our domestic energy needs,” said PACE Executive Director Lance Brown. “Hopefully the naysayers who have frowned on this innovative technology will take note.”

Once online, the plant will capture 65 percent of carbon emissions produced by the plant, making the Kemper County Energy Facility one of the first examples globally of a large-scale power plant capable of capturing carbon dioxide. Much of the carbon dioxide captured at Kemper will be used to enhance the extraction of oil from wells in the region.

“At the same time the anti-coal movement is heralding the end of coal, projects like the one in Kemper County are helping to show that investments in technology can be  a win for power customers and the environment,” Brown said.  “If we believe in a secure energy future for our country, we should continue to look for new ways to turn our vast energy resources into low-cost, reliable power.”