The EPA’s “Clean Power Plan” would drastically increase energy costs for all Nebraskans without achieving its stated goal of combating climate change.
Under the plan, the state would have until 2018 to submit an individualized plan to reduce statewide carbon dioxide emissions by 26 percent. Here are five reasons why Nebraska needs to reject this federal mandate:
1. Higher energy prices impose a back-door tax hike on all Nebraskans.
Nebraska’s electric utilities operate under a statutory mandate to provide low-cost and reliable public power. Neighboring Wyoming’s abundant supply of coal has played a significant role in meeting this obligation. As a result, the state’s utilities have invested nearly $4 billion in coal-fired resources since 1990.
The EPA’s mandate would require Nebraska’s transmission infrastructure to undergo significant, costly upgrades to accommodate an unrealistic target for renewable and natural gas production. Nebraska energy ratepayers, who finance the public utility system, will be responsible for paying the bill. Residential rates would increase by 24 percent, costing an additional $3.5 billion for electricity by 2020. As prices increase, ratepayers will pay larger amounts of sales tax on their utility bills as well.
2. Nebraska’s energy and environmental experts have questioned basic assumptions in the EPA’s plan.
The Nebraska Public Power District (NPPD), which services 86 of Nebraska’s 93 counties, concluded the EPA failed to show an emission limitation which is achievable or adequately demonstrated in the state of Nebraska. The Nebraska Department of Environmental Quality (NDEQ) echoed this concern, stating EPA’s goal for Nebraska contains inaccurate assumptions and unrealistic expectations.
NDEQ also criticized the EPA for not taking into account the state’s significant investment in its existing electric generating units to comply with federal air quality regulations, a cost also borne by ratepayers.
But what about climate change? It turns out the EPA’s national emissions goal would only shave off 1.3 percent of projected global growth in emissions by 2030. At the same time, that growth is projected to increase 23 percent worldwide.
3. Additional renewable generation poses several economic and resource limitations.
State officials also argue the EPA has not considered practical problems with renewable generation across Nebraska. The rule calls for increasing the state’s renewable generation from 4 percent to 11 percent by 2030. According to NPPD, this would require $5 to $8 billion to build 4,000 megawatts of wind generation. Because Nebraska already has significant excess generation, much of the additional wind would need to be exported. NPPD estimated it would need four 345-kilovolt transmission lines approximately 800 miles long to export the surplus wind, which would cost another $4 billion. The utility warned the EPA that the goal is completely unrealistic and unfeasible.
NPPD also argued few export opportunities exist for the state’s utilities. Although Nebraska has an abundance of high wind resources, so do the surrounding states that would serve as potential customers.
4. The potential for blackouts and premature plant closures.
The North American Electric Reliability Corporation (NERC), which is responsible for maintaining the reliability of the U.S. bulk power transmission system, determined the Agency’s timeline was unworkable. Southwest Power Pool, which includes Nebraska’s utilities, said the rule’s aggressive shuttering of coal-fired plants could cause cascading outages and voltage collapses. That’s because the plan takes coal units offline faster than utilities can build new sources of power. Ultimately, the grid cannot remain fully functional and charged without dependable baseload resources to use when renewables are unavailable.
5. The EPA lacks the authority to mandate the plan.
The Clean Air Act only allows the EPA to regulate existing, stationary sources inside the power plant fence line. However, the target reduction goals cannot be met without forcing states to implement measures that occur outside the plant’s fence line. In other words, the federal government can limit emissions from coal and gas plants, but not direct states to restructure their entire electricity system.
For these many reasons, Nebraska should refuse to submit an individualized reduction plan. The upfront capital and transmissions costs are insurmountable and would likely cripple the state’s economy without reducing global carbon emissions. Nebraska should say no to the most expensive environmental regulation in U.S. history.