WASHINGTON – The Environmental Protection Agency’s plan to reduce carbon emissions from coal-fired power plants could unintentionally limit Montana’s ability to use wind energy and penalize utilities that have already improved their energy efficiency, a Montana utility regulator told a congressional panel Tuesday.
“The EPA essentially ignores the details of a state’s situation, and instead applies a cookie-cutter formula,” Montana Public Service Commissioner Travis Kavulla, R-Great Falls, told a House Energy and Commerce subcommittee.
If EPA imposes unrealistic goals on Montana and other states, it could end up undermining the federal government’s goal of reducing the carbon emissions that cause climate change, Kavulla testified.
For example, Kavulla said, the 2,100-Megawatt Colstrip coal-fired power plant operated by PPL-Montana has made improvements during the last decade to increase its energy efficiency by about 5 percent.
But the EPA has set a goal that plants must increase their energy efficiency by 6 percent from a baseline set in 2012. That means Colstrip – the second-largest coal-fired plant in the West – won’t get credit for the 5 percent improvement in efficiency it has already made, Kavulla said.
“Ironically, the many power plants that have already made such upgrades are penalized by the proposed rule because it is assumed that a further 6 percent reduction can be made,” he said.
Kavulla was one of seven state utility commissioners or environmental quality officials who testified before the energy and power subcommittee Tuesday. The hearing focused on the challenges that states will face in trying to comply with the EPA’s proposed Clean Power Plan.
On June 2, the EPA announced a 645-page proposed rule to reduce carbon emissions from existing power plants, especially plants fueled by coal. Coal is one of the cheapest sources of power, but it generates more carbon emissions than any other fossil fuel.
Under the Clean Power Plan, which has not yet been finalized, states would be required to develop, adopt, and submit their plans to reduce carbon emissions to the EPA for approval by June 30, 2016. If a state does not submit a plan or submits one the EPA finds to be unsatisfactory, EPA would impose a federal plan on the state.
“For the first time, EPA would have substantial control over how electricity is generated, transmitted and consumed,” said Rep. Fred Upton, R-Mich., chairman of the Energy and Commerce Committee. “No longer would states have the last word on items such as the best mix of coal, natural gas, nuclear, and renewables to meet electricity needs.”
Kavulla said he has no quarrel with the EPA’s goal of trying to reduce climate change. The U.S. Supreme Court has ruled that the EPA has the responsibility to reduce carbon emissions under the Clean Air Act.
“My concerns regard the approach EPA is taking in fulfilling this responsibility,” Kavulla told lawmakers.
Citing another local example, Kavulla said the North Dakota-based Basin Electric, which provides power to Montana and eight other states, designed its natural-gas powered Deer Creek Generating Station to run a little less than half the time so that it can take advantage of wind power when it is available. Deer Creek needs to have the ability to ramp up when the wind isn’t blowing and ramp down when it is, Kavulla said.
However, the EPA plan calls for the Deer Creek station and other natural gas plants to operate at 70 percent of capacity, which would undermine their ability to use wind energy, Kavulla said.
The EPA is seeking to shift existing power production from coal to natural gas, which produces fewer carbon emissions. But that rule would not allow Deer Creek to take full advantage of a much cleaner source of energy, Kavulla said.
“It is yet another irony that operating natural gas plants the way (the EPA plan) suggests could hamper those units’ ability to accommodate carbon-free wind energy,” he said.
Kavulla said he is hopeful that the EPA may extend the public comment period on its proposed Clean Power Plan. That comment period is now set to end on Oct. 16.
The impacts on Montana and other states are so complex that more time is needed to analyze them, Kavulla said. He said there needs to be an analysis of the reliability of the electric grid in the West before the EPA plan is finalized.
“In the end, I expect EPA to come up with a more reasonable rule, or for Congress to act,” he said.
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