Western regulators grill top EPA official on carbon rule

Source: Debra Kahn, E&E reporter • Posted: Thursday, June 5, 2014

SEATTLE — Western utility commissioners pressed a top U.S. EPA official today for more detailed information about a proposed rule for curbing carbon emissions from existing power plants, but they got little for their efforts.

At the Western Conference of Public Service Commissioners here, Idaho and Montana regulators asked Joe Goffman, EPA’s senior counsel for the Office of Air and Radiation, how the rule would address interstate coal contracts and reliability issues involved in switching to gas-fired power. EPA’s proposal envisions reducing carbon dioxide emissions from existing power plants 30 percent by 2030 from 2005 levels.Idaho regulators expressed concern about how the rule would address a shutdown of a coal-fired power plant in a neighboring state that supplies an in-state utility.

“Is there some kind of offset?” Idaho Public Utilities Commissioner Marsha Smith asked. “I’m just a state regulator trying to see that my customers don’t get the shaft.”

Goffman said states might want to work together but that it was a question for them to decide.

“The Clean Air Act says, ‘EPA, it’s not your job to worry about where the electrons go,'” Goffman said. “It’s your job to worry about where the CO2 is being emitted.”

He also pointed out that the rule was designed to coincide with the aging of the coal fleet in the next decade.

“We knew when we put this proposal together that we’d be imposing these carbon requirements when there were likely to be a lot of changes going on in the sector anyway,” he said.

Montana Public Service Commissioner Travis Kavulla, asked about states that had limited transmission and natural gas pipeline infrastructure and would need to switch from coal to natural gas to comply with the rule.

“We think the compliance period … does provide enough time to accommodate upgrades, at least in some states, to support increased use of natural gas,” Goffman said.

Goffman sought to teach commissioners on the scope of the rule, which he stressed was aimed at reducing CO2-equivalent emissions from power plants.

“So many folks in this room and in this discussion have been schooled not just on what your core jurisdictions and responsibilities are but by national discussions of legislation like cap and trade or national discussions of clean energy standards, and this ain’t either of those things,” he said. “It’s not a surrogate for a national energy standard or a national carbon standard.”

Electric Power Research Institute Vice President Hank Courtright asked whether the rule would dovetail with efforts to increase vehicle electrification. Replacing diesel with electricity would reduce carbon emissions overall but increase them from generator smokestacks, he said.

“Is there a trade-off there?” he asked.

Goffman said that wasn’t included in the scope of the rule. “If you’re asking whether a state plan can cover an increase in emissions at an EGU [electrical generating unit] by crediting CO2 avoided from the tailpipe of a car, that’s a great idea,” he said. “We don’t have legal authority to permit that. We just don’t. It is not a surrogate for economywide legislation.”

In a subsequent panel, officials from Washington state and Hawaii praised the EPA proposal, while other commissioners expressed reservations.

“I feel bad about saying the easiest way forward … is start preparing the lawsuits now, because that seems to be an easier path,” said Idaho Public Utilities Commission President Paul Kjellander. “We can’t seem to get clear responses in relation to what 111(d) has the power to resolve or not resolve.”