Georgia’s utility regulators will do whatever they can to fight U.S. EPA’s proposed carbon rule for existing power plants, the Georgia Public Service Commission chairman said yesterday.

At the same time, such a decision will be left to the courts, said Chuck Eaton, speaking to a small group of energy industry professionals.

“We have to check our politics at the door and figure out how to implement this extremely aggressive schedule,” he said.

EPA wants a broad reduction in carbon emissions by 2030 and assigned each state a specific target. For Georgia, this means cutting greenhouse gas emissions by 46 percent. The number is based on a formula EPA used after looking at the state’s power plant fleet in 2012.

Suggestions to meet these targets include building more nuclear reactors, adding renewables, running more natural gas plants more often and reducing overall demand on the power grid. Georgia’s utilities and policymakers argue that they are already doing those things — including stepping out early to add the nation’s first two new reactors in nearly 30 years — but that those efforts already were baked into EPA’s calculations.

“Here in Georgia, 111(d) is going to be extremely difficult to implement,” Eaton said, referring to the section of the Clean Air Act that is related to the rule.

The rule takes away the flexibility the PSC has with Georgia Power’s long-term energy plan, which the agency reviews and approves every three years. It also means more nuclear power is a matter of “when,” not “if,” he said.

“111(d) is as much a nuclear expansion rule as it is anything,” he said. “If you’re going to take coal off the map, nuclear becomes more and more important. You’re going to see more nuclear.”

The PSC last approved Georgia Power’s Integrated Resource Plan (IRP) in 2013.

The utility hasn’t spoken directly with Eaton about how EPA’s Clean Power Plan would factor into the IRP, he said in an interview with EnergyWire. The rule tosses out the tradition of combining economics and a diverse fuel mix to come up with a long-term plan, however, he said.

“It’s taking away our flexibility to choose the lowest-cost option, economic dispatch, and force us to using certain options that may be a lower cost one year and could be the highest cost the next year,” he said.

Georgia Power and its parent, Atlanta-based Southern Co., have always been aggressive about keeping nuclear in its mix of fuel options. Southern CEO Tom Fanning frequently touts Georgia Power’s Plant Vogtle nuclear expansion project and said in July that he would “love to announce by the end of this year the development of a new nuclear option” (E&ENews PM, July 23).

Fanning told analysts a few days later that the company would start the permitting process only if state utility regulators concurred on adding more nuclear and that whichever four of Southern’s utilities was building the project would be able to recoup the costs.

“That preserves the option to build new nuclear if that looks like that’s desirable from a customer standpoint in the future,” he said (EnergyWire, July 31).

Eaton said Georgia Power has not come to him with any specifics such as “this is what we’re looking at and when,” he said.

But if the carbon rule is implemented, especially as it’s written, there’s just not many other options for baseload power, he said. He considers it risky to invest exclusively in natural gas because of its price volatility.

Even with ample supplies of natural gas at low prices, that’s certain to change if every utility in the United States starts using more of it, he said.

“If you’re going to continue to take coal off the map, then you’re going to have to look to other large-scale options,” he said.

See the article here.