The design and implementation of the
U.S. Environmental Protection Agency’s (EPA)
Clean Power Plan, which is intended to reduce the U.S.
electric system’s CO2 emissions by 30 percent from 2005
levels by 2030, will not jeopardize or compromise the
reliability of the U.S. power system, according to a study
by Analysis Group energy experts. The report, “Electric
System Reliability and EPA’s Clean Power Plan: Tools and
Practices,” addresses the impact of ongoing changes in the
energy industry for stakeholders and offers recommendations
to ensure reliability.
The report demonstrates that “the industry, its reliability
regulators, and the States have a wide variety of existing
and modified tools at their disposal to help as they
develop, formalize, and implement their respective State
Plans.” In particular, it notes that, “These two
responsibilities – assuring electric system reliability
while taking the actions required under law to reduce CO2
emissions from existing power plants – are compatible, and
need not be in tension with each other as long as parties
act in timely ways.”
The Analysis Group team, led by Senior Advisor Susan
Tierney, Vice President Paul Hibbard, and Manager Craig
Aubuchon, analyzed the meaning of electric system
reliability for key stakeholders, the concerns of
commentators related to the EPA Clean Power Plan, and
options to ensure that the plan is implemented in
conjunction with electric system reliability. In evaluating
potential concerns related to the plan, the report notes
that, in fact, “[A] recent survey of more than 400 utility
executives nationwide found that more than 60 percent felt
optimistic about the Clean Power Plan and felt that EPA
should either hold to its current emissions reduction
targets or make them more aggressive.”
In its findings, the report notes that the energy industry’s
past experience and ongoing efforts should address many of
the concerns raised in the nearly four million comments that
have been received by the a EPA: “Many of the reliability
issues identified in public comments are not new – the
industry has responded successfully and effectively to
similar challenges in the past. And for several years, some
of the trends that commenters note must now be addressed in
response to the Clean Power Plan are actually developments
that have been underway for many years – and that are
currently being addressed.”
Moreover, the report notes, many of the most striking
concerns ignore the historical reality of public policy and
industry action: “many of these comments tend to assume
inflexible implementation and present worst case scenarios,
with an exaggerated cause-and-effect relationship. Moreover,
many comments … tend to assume that policy makers,
regulators, and market participants will stand on the
sidelines until it is too late to act. The history of the
electric system and its ability to respond to previous
challenges including industry deregulation and previous
Clean Air Act regulations … prove that this is highly
unlikely. These challenges will be solved by the dynamic
interplay of regulators and market forces with many
solutions proceeding in parallel.” The authors point out
ways that states ultimately have significant flexibility in
how they structure their plans to reduce pollution from
their power sectors, and note that this flexibility will
support reliability.
Analysis Group previously released two other related reports
examining the ability of states to implement the EPA’s Clean
Power Plan and implications for electric reliability. One of
those studies, “EPA’s Clean Power Plan: States’ Tools for
Reducing Costs and Increasing Benefits to Consumers,”
concluded that states are, in fact, well positioned to
implement the plan. The other study, “Greenhouse Gas
Emission Reductions From Existing Power Plants: Options to
Ensure Electric System Reliability,” described the context
for evolving reliability practices in the industry.
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