Missouri faces steeper carbon cuts under Obama rules

The EPA is moving the bar when it comes to the so-called “Clean Power Plan” and it’s going to increase costs for all electric utilities in the state and all customers of those utilities, including both business and residential customers.

AIM president Ray McCarty was at a stakeholder meeting last Wednesday where these regulations were discussed. As he wrote in a blog post following that meeting: “The federal government apparently believes if they put requirements in regulations, technology will suddenly appear to meet the requirements of the regulation. Last time I checked, scientific development of new technologies simply does not work that way, and all consumers, including Missouri employers, will pay the price for this shortsighted regulation”.

AIM believes that the “Clean Power Plan” will cause energy costs to balloon for both manufacturers and individual customers alike.

From the St. Louis Post Dispatch 

Revised federal rules will require steeper cuts to Missouri’s heat-trapping carbon dioxide emissions, putting greater pressure on the state and its utilities to begin shifting away from coal.

The final carbon rules released by the Obama administration last month, known as the Clean Power Plan, made several changes from the initial proposal released in 2014. There are two extra years, until 2022, to begin hitting carbon reduction targets, but the final 2030 goals also changed.

“While there’s an additional two years, the final target in my mind is disproportionately harder on Missourians than other states,” said Ajay Arora, vice president for environmental services and generation resource planning at St. Louis-based Ameren Corp.

In the proposed rule, the Environmental Protection Agency called for a 21 percent cut in Missouri’s carbon emissions. The final rule calls for a 37 percent reduction from the state’s 2012 levels. That number could vary depending on how the state calculates the reductions.

Many other coal-reliant states have similar percentage reductions in their rate of carbon emissions, and so do most of Missouri’s neighbors. Illinois and Iowa, for instance, require cuts of 42 percent, while Kansas needs 44 percent.

Complying with the rules is likely to mean cutting back on coal and boosting wind and solar electricity generation. While a final plan could look far different, a potential compliance scenario put together by Missouri Department of Natural Resources staff shows coal falling from some 80 percent of the state’s electricity generation to around 50 percent by 2030.

 “Coal’s still a big part of the energy mix even with the Clean Power Plan, but it is going to have to be reduced in order to meet our goals,” Mark Leath, a DNR air program staffer, told a gathering of utility representatives, environmental groups and other interested parties Wednesday in Jefferson City.

It was the first meeting hosted by the DNR since the final rules were released, and the department emphasized it’s still very much in listening mode. During a meeting Thursday at its St. Louis area office, DNR staff also discussed the rule with the Missouri Air Conservation Commission.

The EPA calculated the state targets differently in the final rules, meaning it’s not quite an apples to apples comparison, Leath told the commission. But even so, he acknowledged that “it has become more stringent for Missouri.”

The department must submit an initial state plan to the EPA by next September. While it will likely ask for an extension until 2018 for a final plan, the DNR has already started gathering feedback from utilities and other stakeholders.

Ameren Missouri is the largest utility in the state and generates about three-quarters of its electricity from carbon-intensive coal. However, it will share the burden of cutting the state’s carbon profile with the state’s other investor-owned utilities, rural electric cooperatives and municipal electric providers.

The DNR and utilities have some experience allocating responsibility for reducing other pollutants under other federal programs, said Kyra Moore, the DNR’s air pollution control program director. Ultimately, deciding which utility cuts how much carbon is “a negotiation between the sources and the state,” she said.

Those discussions haven’t begun yet, Ameren’s Arora said.

“I expect we’ll be working with the energy providers and getting their thoughts on the rules,” he said. “It really depends on how the state is going to structure the state plan, and we haven’t gotten that far yet.”

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