Monday, July 1, 2013

Climate change plan impact hard to determine

President Obama’s climate change plan announced June 25 directs the U.S. Environmental Protection Agency to work closely with states, industry and other stakeholders to establish greenhouse gas (GHG) emission standards for both new and existing power plants. Implementation of the announced new rule for existing power plants is not expected to occur for several years.

The electric power industry has been a leader in reducing emissions over the last two decades, including GHG emissions in recent years.

Electric power sector emission reductions are due largely to fuel switching from coal to natural gas; slower economic growth; record levels of renewable energy generation (e.g., hydro, wind and solar photovoltaic); and increased energy efficiency by consumers.

Our company has demonstrated a dramatic change in environmental performance. From 2000 to 2013, our power plant capacity is up 50 percent, while emissions of nitrogen oxide, sulfur dioxide, mercury and particulate matter are down by 80 percent.

We will not be able to estimate the impact of a new rule regarding existing plants until the details of the President’s proposal are fully developed.

We maintain our plants to retain efficiency:
  • For example, the new coal-fueled units at Oak Creek Power Plant are among the most efficient in the U.S. 
  • Even our older units at Oak Creek are in the top 10 percent in efficiency among coal plants in the Midwest. As a result, they are emitting less carbon dioxide per unit of energy because of their efficiency. These units should be among the least impacted by a carbon dioxide rule, which should be good news for our customers.

Any rule regarding existing plants should be based on commercially available, cost-effective technologies. The new rule needs to take into account the potential impact it would have on customer rates. As a leader on reducing emissions, we also believe any new rule should give credit for early actions, such as repowering of Port Washington Generating Station from coal to natural gas, our plan to convert Valley Power Plant from coal to natural gas and our significant investment in renewables – two of the state’s largest wind farms and a biomass plant.

We Energies President, Chairman and Chief Executive Officer Gale Klappa discussed the issue when he appeared on UpFront with Mike Gousha.

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