comtech

Novemeber 2015

Dustin Tripp

EPA

For over a year now, your Cooperative has been informing members of proposed rules issued by the U.S. Environmental Protection Agency (EPA) that could potentially have a significant impact on your cooperative in the future.  The Cooperative provided an opportunity for members to express their comments and concerns about the proposed rules and members responded.  Approximately 10,000 Cooperative members responded by providing comments to the EPA.  This was a tremendous response from the Cooperative members.

The initial proposed Clean Power Plan was released by the U.S. EPA on June 2nd, 2014, which was a 645 page proposed rule to reduce greenhouse gas emissions from existing power generation facilities as part of the President’s Climate Action Plan.  The proposed rule called for reductions to begin in 2020 and to achieve a national average reduction of 30% by the year 2030.  The proposed rule had a specific reduction target for each state and for Illinois, the proposed rule called for a 33% reduction by the year 2030. 

On August 3rd, 2015, the U.S. EPA released the final version of the Clean Power Plan, which consisted of over 1,500 pages aimed to reduce greenhouse gas emissions from existing and new power generation facilities.  The final rule calls for a 32% national average reduction of greenhouse gas emissions by the year 2030.  The final rule is significantly different than the proposed rule and is much more stringent for Illinois than the proposed rule.  The final rule now calls for a 44% reduction in Illinois greenhouse gas emissions by the year 2030.  This is a very complex rule and is one of the most aggressive and controversial regulations in our nation’s history.

At the present time there are no proven, commercially available, economical technologies available to capture and sequester carbon emissions from coal plants.  Studies have indicated that even if the technology was available to reduce carbon emissions, the cost of electricity from a coal plant equipped with the technology could increase by as much as 80%.  Therefore in order to meet this new EPA rule, the utility industry would have to close numerous coal plants across the country and rely much more heavily on natural gas.  Given the historic volatility in natural gas prices and the delivery infrastructure problems encountered in the first quarter of 2014, such policies are putting the reliability and affordability of our nation’s electric grid at much greater risk.

In the past, coal has proven to be the most abundant, reliable and economical fuel to generate electricity in the United States.  Over the past, the industry has proven that coal can be used to produce more electricity, more efficiently, while reducing emissions.  Since 1970, coal used for electricity has increased approximately 170 percent while key emissions have decreased 90 percent per unit of power produced.  Advances in coal technologies deployed at the Marion plant and new plants installed with state-of-the-art technologies like Prairie State Generation Campus continue to improve efficiencies and reduce emissions.

Your Cooperative’s power supplier has made significant investments in coal-fired generation and in emission control equipment to utilize coal in an environmentally responsible way.  Your Cooperative’s power supplier utilizes a diversified portfolio of electricity generation including coal, natural gas, hydro and wind power.  Your Cooperative has long promoted a variety of energy efficiency measures to benefit Cooperative members.  However, the vast majority of your Cooperative’s power production (like that in many other Midwestern states) remains coal-fired.

Your Cooperative remains concerned about the rule and how it will impact the cost and reliability of electricity for this nation especially due to the premature generation plant closures and the stranded costs associated with those facilities.  Over the next few years, the State of Illinois will be developing a plan in order to meet the new federal rule.  I will update you in the near future regarding the status of the plan that is being developed by Illinois.

Thank you.

See you next month and as always, "We'll keep the lights on for you."