October Manager's Message
For nearly a decade, Renville-Sibley, East River Electric and Basin Electric and other cooperative members throughout the country have been seeking from our elected legislators the development of a clear and concise legislative policy. To date, nothing has happened.
In the meantime, the Environmental Protection Agency has taken aggressive action, proposed sweeping changes to the rules and regulations surrounding emissions from power plant facilities that provide low-cost electricity for Renville-Sibley’s members. Those changes come with a big price tag, money that will ultimately come from the pockets of all consumers. The cost is more than monetary; it’s also jobs, energy development and reliability.
One of the greatest challenges with EPA’s process is its piecemeal approach. Addressing emissions one at a time prevents utilities from developing an economically viable plan moving forward. “Instead of looking at long-term planning, EPA’s rules are forcing costly controls on existing facilities when it might make more sense to replace those facilities in 20 to 30 years,” states Lyle Witham, Basin Electric’s Manager of Environmental Services.
Regulation means more uncertainty for energy development and it puts the country’s future energy supply in question. With fewer utilities investing in domestic fuels, companies will seek export markets to balance declining domestic sales. The result will be no measurable decrease in worldwide greenhouse gas emissions as domestic energy development declines.
The most immediate issue for utilities is EPA’s regulation of greenhouse gases, including carbon dioxide, using the Clean Air Act. EPA’s first rulemaking on this issue established the Greenhouse Gas Reporting Program, which requires utilities and suppliers of fossil fuels and industrial gases to begin data collection in 2010 and report to EPA beginning in 2011.
Though no emissions standards have been set at this time, Witham says the rulemaking is the first step to further regulation of carbon dioxide and other greenhouse gases. He says costs for implementing any controls for greenhouse gases vary significantly and will depend on a number of factors.
There are other proposed emissions rules EPA has put on a fast track that have significant implications for utilities as well. Each rulemaking is saddled with its own set of challenges, many of which are still unknown.
Ensuring all generation facilities are in compliance will continue to be a steeper hill to climb, both technically and financially. Basin Electric has always maintained 100% environmental compliance at all its facilities, a claim that is becoming very challenging to adhere to. Even without considering recent EPA action, Basin Electric has invested more than $1.4 billion in power plant emissions control technology, and more than $152.5 million will be invested annually to operate and maintain those controls.
It remains vital that our country’s leaders define a clear and comprehensive climate policy. Without legislative certainty, the EPA will continue to push for costly regulations that, in the end, will have little measurable impact on humans or the environment, but will most certainly drive up electric rates for Renville-Sibley and its members.