SALT LAKE CITY — President Obama's Clean Power Plan mandating carbon reductions from existing power plants across the country has been assailed by Utah and other states as an unprecedented attack on coal that falls outside the scope of the Clean Air Act.
And even as states scramble to point out the plan is unworkable, illegal, costly and counter to its objective to reduce pollution, multiple state legislatures — particularly in coal-rich states — already have moved to undercut the federal rule, which is due out this year.
With just two weeks left in the 2015 Utah Legislature, anything is likely to happen as far as the Beehive State following the lead of states such as Kentucky, Virginia or Pennsylvania.
Those states passed laws giving their legislatures the power to veto any state-crafted carbon emission reduction plans, and other states such as West Virginia, Montana and Minnesota want their lawmakers to have the ability to sign off on any carbon reduction plan before it is submitted to the federal government.
Rep. Stephen Handy, R-Layton, is running HJR19, which declares the Utah Legislature's support of the state's position asking the U.S. Environmental Protection Agency to withdraw the rule and let Congress and the states reduce power plant emissions. The Utah House of Representatives passed the measure on Tuesday, and it now goes before the Senate.
"As a state, we are really, really worried about this," Handy said, adding that he has not heard of any legislative plan to go so far as to invoke veto power on planned carbon reductions.
"I think we have a reasoned, well thought out response in our remarks to the EPA," he added.
The Clean Power Plan assigns each state specific targets to reduce carbon dioxide emissions from 2005 levels, with a national goal to achieve a 30 percent reduction by 2030.
Under the proposed rule unveiled last June, states will be given a one-year deadline to come up with their own state implementation plans on how those reductions are achieved, a tight turnaround that on its own makes compliance problematic, according to state air quality regulators.
The angst over the Clean Power Plan is wide and deep. Critics say the plan will cost the country more than $73 billion a year, slay hundreds of thousands of mining and manufacturing jobs, and drive up electricity rates for consumers. A dozen states have already filed suit to stop the new regulations from being adopted.
Utah Gov Gary Herbert, in a letter to the EPA last December, called the scope of the rule unprecedented because of its potential impacts to the country's vast and complex electricity generating system as a whole, regulation that he says is beyond the scope of the EPA and Clean Air Act.
"Such a dramatic expansion of Clean Air Act authority warrants clear direction and clear legal authorization from Congress, which has not yet been granted," Herbert wrote.
Just a couple of weeks ago, Herbert and a contingent of other members of the Western Governors Association met with EPA administrator Gina McCarthy in Washington, D.C., to once again reiterate their concerns and ask that the rule be abandoned.
Like many other states, Utah believes the EPA arrived at unrealistic targets based on flawed assumptions. How much states have to reduce those carbon dioxide emissions was derived from a complex formula that looked at each state's volume of emissions against the backdrop of its in-state generation of electricity.
The EPA gave Utah a target rate of 1,322 pounds of carbon dioxide, or a reduction of roughly 27 percent. Citing an analysis by the National Economic Research Associates, state officials said Utah will be among 14 states that will incur peak electricity price increases of more than 20 percent if the rule goes into effect.
Right now, Utah's average price for electricity is 19 percent lower than the national average — 8.2 cents per kilowatt hour from all sectors.
"This proposed rule-making unnecessarily and abruptly undermines the crucial role coal plays in our state's and nation's energy system," Cody Stewart, Herbert's energy adviser, said in comments to the EPA. "Coal is the workhorse of our power system."
Because each state is treated differently, Stewart added that the consequence of the rule is creation of winners and losers derived from an analysis built on faulty assumptions.
"Utah's coal-fired power plants are among the most efficient and lowest emitting in the country," Stewart said. "The EPA's approach of assigning different carbon dioxide emission targets to states could lead to the absurd result of preserving less clean, less efficient power plants at the expense of cleaner, more efficient power plants based solely on the state in which the power plant operates."
Local environmental groups believe Utah is mounting a hollow "sky is fallling" argument.
"We believe the state's concerns are significantly overblown," said Matt Pacenza, executive director of HEAL Utah. "Our major utility, Rocky Mountain Power, has already started a shift away from coal power. Now, we wish they would embrace renewable energy more than they have, but what they have done is invested more in natural gas and energy efficiency, both of which significantly reduce the carbon output of our electricity sector."
It does not surprise Pacenza that Utah and other coal-rich states are dragging their heals on what he describes as "modest" reduction targets contained in the Clean Power Plan proposal, but he says it is disappointing.
"It's incredibly depressing when we just had the warmest February on record — and scientists have just issued warnings about the possibility of mega-droughts — that the Governor's Office of Energy Development is wasting its time complaining about the most modest of carbon reduction targets," he said. "Utahns want them to get to the hard work of building a low-carbon, 21st century energy economy, not hanging on pitifully to the dirty energy of the past."
But Rocky Mountain Power, Stewart and the state energy office said it is not that easy, and the Clean Power Plan is built on assumptions that ultimately make it unworkable in some aspects and only achievable in others if there is more flexibility built into reductions.
"Rocky Mountain Power believes the EPA rule can be most cost effectively implemented if the final rule allows flexibility during the time leading up to 2030 target date," said spokesman Paul Murphy. "Such flexibility will allow states and utilities to work together to find solutions to meet the goals of the final rule, which we anticipate to include renewable energy and energy efficiency."
Despite PacifiCorp's transition to renewable energy, which critics say has not happened fast enough or to a broad enough extent, 81 percent of Utah's electric generation in 2013 came from coal.
In its nine-state portfolio of electric generation, PacifiCorp gets 62 percent of its power from coal-fired plants, but that number is projected to drop by 46 percent by 2024.
Nationally, coal provides just 40 percent of the nation's electricity as the energy portfolio has shifted to embrace burgeoning supplies of cheap natural gas and renewable sources such as solar and wind.
The power industry estimates that one-third of the nation's 1,000 coal-fired power plants will be retired if the 600-page proposal goes into effect. Out of Rocky Mountain Power's three coal-fired power plants in Utah, the Carbon facility outside of Helper was already slated for closure this year because emission upgrades didn't make sense at the aging plant.
Already under mandates to cut sulfur dioxide and other pollutants, existing power plants are the nation's largest source of carbon dioxide, or the chief gas linked to global warming.
According to the White House, power plants in Utah emitted 31 million metric tons of carbon pollution, or the equivalent of 6.5 million cars. The Clean Power Plan is President Obama's cornerstone to deal with climate change.
Against that backdrop, anti-coal activist groups such as the Sierra Club say it's imperative to pursue other sources of energy.
"Utah is well-positioned to meet the Clean Power Plan and can do it in beneficial ways, like through energy efficiency and solar development that save Utahns money and create more jobs at home," said Mark Clemens, Utah's Sierra Club manager.
An independent analysis by Fitch Ratings, a nationally recognized statistical ratings organization and a global leader in credit ratings and research, suggests it won't be that easy for Utah.
The company, using EPA data and its own research on public power and cooperative utilities, concluded that Utah — second only to West Virginia — would encounter the highest costs of any state to replace coal-based electric generation with cleaner sources.
"What this is suggesting for Utah in essence is that the EPA believes Utah has fewer low cost alternatives available to it to reduce carbon emissions," said managing director Dennis Pidherny. "They have alternatives that they could pursue to reduce carbon emissions, but they appear to be, based on these figures, higher costs than every state except West Virginia."
West Virginia's cost to reduce 1 ton of carbon emissions in 2030 would be $101.15, while Utah's would be $62.50, according to the EPA.
Flipped around, Pidherny said that cost would be what the utility would have to be willing to pay to generate that 1 ton of carbon dioxide emissions because it would be cheaper than to derive the equivalent power generation from an alternative source.
While Utah may have wind, solar and natural gas resources it can plug into, the EPA modeling suggests it would be extremely costly for Utah to embrace those on the scale of coal, Pidherny said.
The cost projection is ominous, but Pidherny said there is good news for the Beehive State. Utah grabbed the No. 1 spot in the country on the "affordability index," meaning of all states, it is best positioned to absorb those costs based on how much a household pays for electricity as a percentage of its median income.
"Electricity is more affordable in Utah than it is in any other state in the nation, and that is based on relatively low price, low usage and relatively high household income on average," Pidherny said. "So even though costs may be high, there may be more than ample capacity to recover that from customers. Now that may not make customers happy, but that would make debt holders happy."
Finally, Stewart said the EPA's desire to cut greenhouse gases may backfire on the Clean Air Act when it comes to other pollutants.28 comments on this story
All of Utah's coal-fired power plants operate in rural areas of the state, well beyond the airshed of the state's troubled zones for fine particulate pollution. Because the Clean Power Plan contemplates "redispatching" power from coal to natural gas, Stewart said that could be problematic.
Utah's four natural gas-powered plants are in or next to urban areas, and while they emit substantially less pollutants, about 60 percent less than coal-fired power plants, they emit nitrogen oxide, a precursor to PM2.5.
"The EPA's assumption regarding natural gas utilization may inhibit Utah's ability to effectively manage its airsheds," Stewart said.
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