Bloomberg News

Rural Power Group Says EPA Rules Thwart Coal-Fueled Electricity

June 18, 2012

An electricity supplier serving 1.5 million customers in four rural states said separate regulations from the U.S. Environmental Protection Agency are thwarting plans to build coal-fired power plants.

Tri-State Generation and Transmission Association Inc., a nonprofit in Westminster, Colorado, can’t complete a proposed plant in Kansas because of the rules, one aimed at curbing mercury pollution and another aimed at greenhouse-gas emissions.

The rules to limit greenhouse-gas emissions from new power plants don’t effect generating facilities that break ground within the next year, such as Tri-State’s.

“This concession may well prove illusory,” Barbara Walz, senior vice president of Tri-State, said in testimony prepared for a hearing tomorrow of a House Energy and Commerce Committee panel. That’s because EPA’s mercury rule “will likely prevent us -- or anyone else -- from commencing the construction of a new coal-fired plant in time to meet EPA’s one-year deadline.”

The Republican-led Subcommittee on Energy and Power is holding a hearing on the EPA’s greenhouse-gas regulation. That’s the first major rule to target carbon-dioxide emissions from so- called stationary sources such as power plants or factories.

The rules will permit emissions from new power plants at 1,000 pounds of carbon dioxide per megawatt hour, about the level for a modern natural-gas plant. The limit would effectively preclude construction of coal-fired plants, which are struggling to compete with decade-low natural-gas prices.

Tight Rules

Walz in her testimony said the EPA has already prevented construction because its mercury standards for new plants are so tight that pollution at that level can’t even be measured now. Tri-State serves mostly rural customers in Colorado, Nebraska, New Mexico and Wyoming, she said.

With the failure of Congress to cut carbon emissions, agency actions are seen by environmental groups as the best chance to combat global warming.

“The proposed new-source standard recognizes that the market has already turned away from building new conventional coal plants due to low-cost natural gas, strong growth in wind and solar power, big opportunities to improve energy efficiency and even the potential for nuclear power,” David Doniger, policy director for the Natural Resources Defense Council, said in his prepared testimony.

Carbon-dioxide emissions since the Industrial Revolution have led to a warming of the Earth’s temperature in the past 50 years, threatening to cause extreme weather, drought and coastal flooding, according to the U.S. Global Change Research Program.

To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net

To contact the editor responsible for this story: Jon Morgan at jmorgan97@bloomberg.net


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