Just like Paul Revere, the experts responsible for managing much of the electric grid in the United States are warning that the EPA’s “too much, too soon” approach to cut carbon emissions by shutting down coal-fired power plants will have disastrous consequences for reliable and affordable electricity. 

According to the North American Electric Reliability Corporation (NERC), the EPA’s proposed Clean Power Plan, or CPP, intends to cut CO2 emissions from existing coal-fired power plants to 30 percent below 2005 levels by 2030. Under the EPA proposal, compliance is front-loaded-substantial CO2 reductions (up to 80% of the total requirements) are required as early as 2020. According to the EPA’s Regulatory Impact Assessment, generation capacity would be reduced by between 108 and 134 GW by 2020.  NERC further states that planning, developing and constructing suitable replacement generation resources to maintain adequate reserve margin levels may represent a significant reliability challenge, given the constrained time period for implementation. 

Now, the regional grid operators are weighing in with comments on the EPA’s proposed plan, and those comments are highly critical. The Southwest Power Pool, or SPP, is the organization that operates the electric grid in Arkansas, Kansas, Louisiana, Missouri, Nebraska, New Mexico, Oklahoma, and parts of Texas.  SPP submitted comments to the EPA on October 9, 2014.   SPP stated that based on its reliability impact assessment, “it is clear that the proposed CPP will impede reliable operation of the electric transmission grid in the SPP region, resulting in violations of NERC’s mandatory reliability standards and exposing the power grid to significant interruption or loss of load.”  In other words, consumers can expect blackouts and interruptions of service.

SPP also expresses concern with the front-loaded compliance scheme of the CPP:  “Based on SPP’s review of the proposed CPP, EPA has considered neither the cost nor the time required to plan and construct electric transmission facilities.”  According to SPP’s comments, it can take up to eight and one-half years to study, plan, and construct new transmission infrastructure.  Retiring coal plants means that new generating facilities will need to be constructed to replace them, and new transmission lines will have to be constructed to connect the new generating facilities to the electric grid.  SPP says that it is impossible to do all of this in the short time frame required by the CPP.

Finally, SPP states that the proposed CPP will cause higher prices for electricity in the SPP region, “resulting in material adverse impacts on SPP customers.”  What a deal for consumers-blackouts and higher costs for electricity!

Similarly, the Midcontinent Independent System Operation, or MISO, the grid operator for much of the North, Midwest, and South regions of the United States, released an outline of the comments it plans to submit to the EPA.  MISO’s comments echo SPP’s concerns about the CPP’s adverse impact on reliability of the electric grid, costs of compliance, and the impossibility of meeting the CPP’s short time frame for compliance.   

And for good measure, the Electric Reliability Council of Texas, or ERCOT, which operates the electric grid in 75% of the state, also issued a report highly critical of the EPA’s plan.   ERCOT’s primary concern with the CPP is that “the timing and scale of the expected changes needed to reach the CO2 emission goals could have a harmful impact on reliability.”  Another ERCOT concern is that the CPP “will also result in increased energy costs for consumers in the ERCOT region by up to 20% in 2020, without accounting for the costs of transmission upgrades, procurement of additional ancillary services, energy efficiency investments, capital costs of new capacity, and other costs associated with the retirement or decreased operation of coal-fired capacity in ERCOT.” Decreased reliability and higher costs for consumers is not a recipe for success-it is a disaster waiting to happen.  

It is becoming more and more apparent that those who are responsible for providing reliable and affordable electricity believe that the EPA’s plan to prematurely shut down coal-fired power plants will make electricity less reliable and more costly.  The facts simply are not on the EPA’s side.  Instead of pushing forward with an ill-conceived and poorly thought out plan, the EPA should listen to the voices of knowledge and experience, scrap the CPP, and let the electricity experts determine how best to provide reliable and affordable electricity.

By: Terry M. Jarrett

Read the article here.