Digging Coal a Hole
November 2, 2007
Ken
Silverstein
EnergyBiz Insider
Editor-in-Chief
Read Ken's Blog
State and federal policymakers may be digging coal into a hole. In a
first-ever, the Kansas Department of Health and Environment denied an air
quality permit for two proposed coal generators based upon the expected
level of carbon emissions. Meantime, a movement is afoot on Capitol Hill to
limit heat-trapping emissions.
Together, the actions work to set a new tone - one that considers it
vital to the nation's environmental and economic futures to regulate carbon
dioxide (CO2). While not immediate, the United States is well on its way to
enacting legislation that would control CO2 emissions, which most scientists
say causes climate change.
In the case of Kansas, state officials turned down Sunflower Electric Power
Corp.'s proposal to build two 700-megawatt plants worth $3.6 billion. They
said that the expected 11 million tons of annual CO2 emissions was
unacceptable. Meanwhile, two U.S. Senate stalwarts are circulating a bill to
cut CO2 emissions by 70 percent below current levels by 2050. "I believe it
would be irresponsible to ignore emerging information about the contribution
of carbon dioxide and other greenhouse gases to climate change and the
potential harm to our environment and health if we do nothing," says Rod
Bremby, secretary of the Kansas Health Department, in a statement.
The fight will continue in Kansas and around the nation. For its part,
Sunflower Electric has said it will challenge the Kansas decision in court
and argue that no regulatory body has the legal right to deny the
construction of two plants based on an emission that is not even regulated.
They furthermore go on to say that Kansas' consumers will pay more for
electricity as a result of the ruling, noting that coal is the cheapest form
of power.
Environmentalists contend that the state regulatory decision will be
leveraged and used as a precedent in similar permitting cases now taking
place throughout the country. As for Kansas, the health secretary there is
unapologetic, noting that the state's attorney general said that the
department's role is to safeguard the people and their air quality.
Coal now supplies almost half the nation's electricity needs. It's under
constant attack from critics who point out that coal facilities account for
a third of the CO2 emissions. It is also responsible for most of the
pollutants that are regulated under the Clean Air Act that involve sulfur
dioxide, nitrogen oxide and particulate matter. And, it is blamed for
mercury emissions that harm reproductive abilities and mental development in
children.
But, coal use worldwide is on the rise and in China an estimated one coal
plant per week is planned well into the future. In the United States, the
Energy Information Administration projects a 66 percent increase in
coal-based power production and a 43 percent rise in CO2 emissions by 2030
if no pollution controls on such releases are required.
Movement Afoot
It's an unsettling phenomenon. Even the utility industry is generally saying
that it would embrace CO2 controls. It emphasizes, however, that the price
tag will be high and must be borne by all stakeholders. At a meeting of the
Edison Electric Institute, utility CEOs said they were open to change but
they disagreed on how to bring about advances. Some, for example, are
advocating a market approach resembling a cap-and-trade system whereas at
least one chieftain is saying a carbon tax would work best.
Senators Joe Lieberman, I-Conn., and John Warner, R-Va., have started the
volley. Their most recent proposal would require electric utilities and all
industrial manufacturers to cut their emissions to current levels by 2012.
Those CO2 releases would then have to be reduced by 10 percent by 2020 and
by 70 percent by 2050.
"As an early and vocal advocate for climate change legislation, Exelon
applauds the bipartisan leadership of Senators Lieberman and Warner to
introduce a bill that will help reduce greenhouse gas emissions to address
global warming as soon as possible," says John Rowe, CEO of Exelon Corp, one
of the nation's largest utilities.
Other supporters say that the congressional measure is a good first step but
that it does not go far enough. According to a recent study by the Union of
Concerned Scientists, stricter limits on CO2 emission are necessary. To
ensure a 50-50 chance of avoiding the worst possible consequences of global
warming, it says that that the United States must cut those heat-trapping
emissions by 80 percent from current levels by 2050.
Critics of the Lieberman-Warner bill, however, maintain that mandatory
carbon dioxide emissions would be a regressive move and that the high cost
of compliance would be passed through to consumers. This nation's poorest
citizens would subsequently be hit hardest as they are the ones who pay a
bigger percentage of their incomes to energy bills. To complicate matters,
those same skeptics add that current legislative attempts at regulating CO2
offer no reasonably-priced alternatives to coal.
"The theory that rationing energy is an efficient path towards confronting
climate change is even now being disproved by the experience of the European
Union," says Myron Ebell, director of energy for the Competitive Enterprise
Institute. "A nation that embraces innovation, growth and resiliency rather
than energy rationing will be better equipped to deal with whatever
challenges the future holds."
But a greater fear now exists and one that reasons irreversible
environmental degradation would endanger the entire global economy. As such,
policymakers are increasingly erring on the side of clean air and water,
arguing that it would be foolish to underestimate the negative effects
global warming - all illustrated by the Kansas ruling and the federal bill
now floating on Capitol Hill. In time and with improvements in technology,
those sentiments will become the law of the land.
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