Berkshire sees tax credits, Clean Power Plan as a better path than carbon tax
Cathy Woollums, the chief environmental counsel at Berkshire Hathaway Energy, said the company, whose utility subsidiaries include Iowa-based MidAmerican Energy Co., Nevada-based NV Energy Inc. and PacifiCorp, does not favor a carbon tax, but instead prefers more “creative” solutions.
MidAmerican, for example, is taking advantage of the extension of the production tax credit for wind energy and investing in up to 2,000 MW of wind energy in Iowa. Combined with the company’s existing wind energy holdings, MidAmerican should have about 6,000 MW of wind-energy capacity in operation by 2018, or about 85% of its annual retail sales.
Cost-effective additions of renewable-energy resources and transmission-grid additions are among the ways a utility with a range of options can choose to reduce its emissions, Woollums said July 25 during a panel discussion at the National Association of Regulatory Utility Commissioners’ summer meeting in Nashville, Tenn.
In the year since the Clean Power Plan was released, market conditions have changed to make compliance easier for many states, Jennifer Macedonia, a fellow at the Bipartisan Policy Center, said. The extensions of the production tax credit and investment tax credit will allow for the addition of more wind and solar generation capacity. Meanwhile, the cost of electricity produced by wind and solar sources continues to decline. Macedonia also noted that the U.S. Energy Information Administration recently lowered its projections for natural gas prices in 2030.
Low wholesale power prices could put pressure on nuclear assets, Macedonia said, perhaps even forcing some to shut down before their operating licenses expire. However, she said the center’s analysis shows that states using a mass-based approach to compliance are more likely to ensure the continued operation of nuclear plants.
Pam Kiely, senior director of regulatory strategy at the Environmental Defense Fund, presumed that the stay placed on the Clean Power Plan will be lifted because, she said, the U.S. Supreme Court has previously ruled three times that carbon dioxide emissions can be regulated. When that happens, she predicted, states will find they are well on their way to compliance with the plan.