Tag: power plants
Why Many States Are Panicked By The Federal Clean Power Plan

Why Many States Are Panicked By The Federal Clean Power Plan

By Sophie Quinton, Stateline.org (TNS)

WASHINGTON — The four huge power plants that stand smoking in Colstrip, Mont., don’t just employ hundreds of workers. They pay property taxes that allow the city of some 2,000 people to afford services other remote, rural communities lack, such as a parks and recreation department.

The electricity-generating plants consume almost all the coal mined at the Rosebud Mine, the second-largest coal mine in Montana. When the mine removes — or “severs” — coal from the earth, the mining company pays the state a severance tax on the value of the coal. Some of the money is invested into state trust funds, and some goes to support statewide services, such as public schools.

But new federal regulations for power plants threaten to put cities like Colstrip out of business. Puget Sound Energy, a part-owner of the Colstrip plants, already wants to close two of them. That would have a fiscal impact on the entire state. A 2010 University of Montana study found that the Colstrip operations contributed 4.5 percent of all state tax revenue and $104 million in state and local taxes.

Many states with significant reserves of coal, oil and natural gas depend on revenue from severance taxes on natural resources. In 2013, Montana’s tax revenue from severance taxes was nearly 12 percent. In West Virginia it was 13 percent and in Wyoming it was 39 percent, according a Stateline analysis of U.S. Census Bureau data.

No wonder those states are so upset about federal Clean Power Plan regulations, President Barack Obama’s bid to reduce the emission of greenhouse gases affecting the Earth’s climate. The regulations, which take effect in December, will require states to reduce emissions from power plants. Coal emits more greenhouse gases than other energy sources, so one way for states to meet the federal goal is to shut down coal-fired plants.

State Rep. Duane Ankney, a Republican who represents Colstrip, said the federal rule would cost Montana dearly: “We’re talking a $700 million to $800 million fiscal impact to the state, county and local governments.”

Montana is one of 26 states suing to stop implementation of the regulations. But regardless of the outcome of the lawsuits, some communities that have depended on coal jobs and tax revenue may have to learn to live without them.

The energy industry is prone to boom-and-bust cycles, and right now, the coal and oil industries are going through a bust. A growing number of coal companies have declared bankruptcy in the past year. State budgets have tightened as the industry slides.

Last month, West Virginia’s Democratic Gov. Earl Ray Tomblin announced a 4 percent, across-the-board budget cut to compensate for a deficit driven by a $190 million drop in severance tax collections. Wyoming’s Republican Gov. Matt Mead announced $200 million in budget cuts, citing falling energy prices.

A boom in natural gas has created a cheaper, cleaner alternative to coal, while federal regulation has made coal-fired power plants more expensive. A 2012 mercury and toxic pollution rule, for example, has led operators to shut down plants or install new equipment.

States like California, New York and Washington, the home state of Puget Sound Energy, have made big, public commitments to fighting climate change by shifting their energy consumption to cleaner fuels. Washington’s commitment is one reason why Puget Sound Energy wants to stop getting electricity from Colstrip.

“Coal reductions are happening in all 50 states,” said Bruce Nilles of the Sierra Club, which along with its partners has helped to convince states and municipalities to shut down 206 power plants since 2010.

The U.S. Energy Information Administration expects coal-fired power plants to continue to shut down and for very few new coal-fired plants to replace them, even without the Clean Power Plan. That’s a big deal, because more than 90 percent of the coal mined in the United States is burned to produce electricity, according to the EIA.

Analysts say the economic woes felt in some parts of coal country, such as southeastern West Virginia, are part of a long-term trend.

“This one’s not cyclical. This is a permanent shift,” said Evan Hansen, principal at Downstream Strategies, a West Virginia environmental consulting firm.

Hansen said Central Appalachia faces an additional challenge: digging for coal is more expensive there than in other regions of the country, partly because of federal mining regulations.
The Clean Power Plan gives each state a different emissions reduction target, depending on the mix of energy used in that state. California is well on its way to meeting its target; Montana may struggle.

“There is no wiggle room for Montana in this Clean Power Plan,” Ankney said.

Montana has to reduce its carbon emissions by 47 percent of 2012 levels by 2030. Over half Montana’s electricity is produced by burning coal, according to the EIA. Most likely, Ankney said, complying would mean shutting down eight small coal plants.

Ankney is trying to keep the Colstrip plants running. Last month, he traveled to Washington state to plead with legislators there who have to approve Puget Sound Energy’s planned changes. As many as 400 jobs are at stake.

Ankney said there just aren’t that many other good jobs in eastern Montana, a sparsely populated, rural part of the state. Colstrip is 30 miles from the nearest highway. The closest large city is Billings, a 120-mile drive away.

It’s always tough for a small, isolated economy to lose its dominant industry. Consider steel mill and factory closures in the Rust Belt in the 1970s and ’80s, or military base closures in the 1990s.

The coal industry has left Colstrip before, when trains switched from coal to diesel fuel in the mid-20th century. “Colstrip became pretty much a ghost town. There was no longer any reason for it to exist, other than that the school was here,” said John Williams, Colstrip’s mayor.

Some utilities and states that are moving away from coal have agreed to spend money to help workers transition, Nilles said. The Obama administration has set aside up to $35 million to help develop local economies and proposed additional funding for job training that Congress has yet to approve.

In states that rely on severance taxes, a struggling coal industry could have a bigger impact on tax revenue than on statewide employment levels, said Mark Haggerty, an analyst at Headwaters Economics, a research company based in Bozeman, Montana.

In Montana and Wyoming, coal mining raises a disproportionate amount of revenue. In Wyoming, coal mining employed about 1.8 percent of all workers, according to a University of Wyoming study in 2012, but generated about 11.2 percent of all government revenue.

The study’s co-author, Robert Godby, hasn’t had the chance to analyze the final Clean Power Plan rule yet. But in looking at the draft, he anticipated that Wyoming’s combined natural gas and coal revenue could fall as much as 46 percent by 2030.

Severance tax money has allowed many energy-producing states to keep other taxes low. Wyoming, has neither a personal nor a corporate income tax.

The Clean Power Plan pushes states to invest in renewable energy sources, which could create a new source of revenue. Wyoming started taxing wind power in 2012, for instance. But wind power isn’t much of a moneymaker. Wind is free, so all a state can do is impose sales and property taxes on wind farms, Godby said.

Coal-producing states could be forced to raise other taxes if severance taxes keep falling. Montana state Sen. Roger Webb, a Republican, raised the possibility last year in a newspaper column criticizing the Clean Power Plan — and not because he supported the idea.

“The president’s carbon regulations create a giant, gaping hole in our state’s budget picture,” he wrote. “The most likely outcome of all this is going to be a huge property tax hike on Montana homeowners and small businesses to fill the gap.”

Ankney doesn’t expect lawmakers to seriously consider increasing taxes. Raising taxes, after all, is anathema to the state’s conservative-leaning Legislature. Instead, he said, “It will be cuts rather than raising taxes.”

Photo: New federal regulations for power plants threaten to put some tiny rural cities out of business. (Flickr/arbyreed)

Some States Battle Obama On Climate Change; Others Try To Address It

Some States Battle Obama On Climate Change; Others Try To Address It

By Chris Adams, McClatchy Washington Bureau (TNS)

NEWPORT, R.I. — In statehouses around the country, the battle is heating up to stop the climate change agenda of President Barack Obama.

But here in the Ocean State, Rhode Island state leaders are not pushing back against the president. They’re going even further than he has.

Whether addressing rising waters that can damage historically significant homes in Newport or reducing the amount of carbon pollution power plants pump into the air, officials in Rhode Island have decided they must act, whatever the feds might do.

Indeed, the debate in Washington may have devolved into a typical Beltway scrum about giving the president what he wants or asking the U.S. Supreme Court to stop him. But in places such as the state capitol in Providence, R.I., and Olympia, Wash., and Sacramento, Calif., state officials already are deploying strategies that could slow some of the impact of climate change.

“These threats are real to us — 21 municipalities out of 39 are coastal,” said Elizabeth Stone, who coordinates climate change policy for Rhode Island’s Department of Environmental Management. “Look at our coastline if we have one or three or five feet of sea-level rise by the end of this century — it’s quite drastic.”

The latest flash point is over the president’s push to reduce carbon pollution. On Oct. 23, the White House formally published its Clean Power Plan to reduce carbon emissions. To reach mandated targets, states can work alone or with neighbors, modifying their mix of coal, natural gas and renewable energy. The goal: Cut power-sector carbon pollution by 32 percent from 2005 levels.

That same day, officials from 24 state governments pounced.

In a lawsuit before the U.S. Court of Appeals for the District of Columbia Circuit, the state officials contend Obama’s Environmental Protection Agency has “vastly overstepped its authority” by “requiring the states to take part in this unlawful regime” that will “require massive and immediate efforts by state energy and environmental regulators.”

Patrick Morrisey, West Virginia’s attorney general and a leader of the state coalition, said he’s focused on the legality of the EPA’s action — not the broader issue of climate change.

“If this is an issue that is going to advance in the future, it should be undertaken by Congress — and we obviously haven’t seen that,” he said in an interview.

“In West Virginia, we are mindful that the consequences of this illegal action are severe,” he added. “There will be lost jobs, the potential for a real spike in electricity prices — and it may potentially put the reliability of the power grid at risk. But all of that is secondary to the core issue: Does the administration have legal authority to advance one of the most sweeping and radical regulations of our lifetime?”

In North Carolina, the Department of Environmental Quality has joined the lawsuit. Secretary Donald van der Vaart, appointed by a Republican governor, said in an interview the rule is illegal and that it will increase costs and cede control of the state’s power-generating system.

“The real question is, ‘Why would I support it?'” he said.

But for evidence that the split among the states is real, you only need to walk down the street from van der Vaart’s office.

There, North Carolina Attorney General Roy Cooper, a Democrat, is not part of the 24-state coalition that van der Vaart’s office is. In a letter to state lawmakers this summer, Cooper said he was concerned that legal action against Obama’s plan “will risk North Carolina’s well-deserved reputation for protecting the quality of our air, recruiting businesses that produce cutting-edged technologies and offering leadership around the world on energy issues. … I encourage you to avoid the path of litigation.”

In Florida, Attorney General Pam Bondi says in a statement that her state “will not stand by and allow these unlawful and heavy-handed utility regulations to trample our states’ rights and drastically increase electricity prices in Florida.”

Some local officials, however, don’t agree. Local governments in Broward County and South Miami last week joined with 18 state attorneys general and individual cities to support the EPA. In a filing opposing the 24-state coalition, those officials said the power plan “will help prevent and mitigate harms that climate change poses to human health and the environment.”

Added Broward County Mayor Tim Ryan: “It’s unfortunate that the state government is taking a position averse to the opinions and the best interests of Florida citizens.” The lifelong Democrat said the government needs to take action because “if we don’t act now, then our children’s and grandchildren’s futures in low-lying areas are jeopardized.”

Legal skirmishing aside, many states already are working on what are known as mitigation and adaptation strategies to reduce carbon emissions and to deal with heat waves, flooding, storm surges and other expected climate change impacts.

“Look, this is already happening,” said Rachel Cleetus, who oversees climate policy for the Union of Concerned Scientists, an advocacy organization. “Despite the legal challenges, the states themselves are moving ahead, putting together compliance plans for the Clean Power Plan. The just-say-no strategy is losing steam.”

That was a reference to a pitch by Senate Majority Leader Mitch McConnell, R-Ky., that states should think twice before submitting to comply with Obama’s power plan.

According to an assessment by the Union of Concerned Scientists, 16 states already are on a path to exceed the Obama administration’s carbon-cutting targets for 2030; a majority of states already have made significant progress toward the 2022 benchmarks also contained in the plan.

Rhode Island, for one, is well on the way to meeting the Clean Power Plan goals, as are other Northeastern states that form the Regional Greenhouse Gas Initiative. Along with other states, Rhode Island also has joined the effort to support the Obama administration in court.

Rhode Island has an executive-level climate change council to coordinate the activities of its state agencies. “Impacts from climate change are already being felt in Rhode Island, like elsewhere in New England. It requires action now, not just in the future,” according to a report from the council.

As with other Northeastern states, Rhode Island’s own goals to cut emissions are broader than the federal plan, targeting transportation, the heating sector and other emissions sources — not just power plants.

“We’ll be looking at significant cuts and pretty aggressive policy suggestions,” said Stone, from the state’s environmental department. She said Rhode Island is positioned to meet the Clean Power Plan goals.

And a reason why is something Pieter Roos sees more and more.

For Roos, executive director of the Newport Restoration Foundation in this historic and picturesque coastal town, political debates over climate change are something of an abstraction.

Instead, he’s preparing to adapt — and his mission is a small slice of what Rhode Island in general is doing, which is a small slice of what many states around the country are doing.

“I’m not prepared to comment on the validity of the scientific evidence,” he said on a recent fall day as he pointed out the homes he oversees — some dating to the early 1700s — that now regularly flood. “I can only comment on the observed evidence, and that is that I see more water in basements.”

His challenge is one faced by preservationists around the country; they’ll gather next year in Newport for a new conference, Keeping History Above Water.

“I am not a scientist. I’m a museum director and a preservationist,” he said. “I can only deal with the issues that are coming up in front of me. … I don’t have time to pay attention to folks who think that climate change isn’t real.”

Photo: A lighthouse off Newport, R.I., as seen on Oct. 9, 2015. Residents and preservationists in Newport are concerned about the impact of climate change on sea levels in the surrounding waters. Even before the federal government came out with its climate-change plan, Rhode Island officials had a detailed plan to address it. (Chris Adams/McClatchy DC/TNS)

Study: Reducing Carbon Emissions Actually Saves Money, Has Health Benefits

Study: Reducing Carbon Emissions Actually Saves Money, Has Health Benefits

Opponents of carbon-reduction policies always argue that they’re too expensive. But a new study published in Nature Climate Change shows that popular proposals to cut carbon dioxide emissions not only help the environment, but can drastically lower health care costs. The savings in some scenarios are more than 10 times the cost of implementing the policies.

“If cost-benefit analyses of climate policies don’t include the significant health benefits from healthier air, they dramatically underestimate the benefits of these policies,” the study’s lead author, Tammy Thompson, told PHYS.org.

MIT researchers compared the health care and the economic costs of three different climate policies: a clean-energy standard, a transportation policy, and a cap-and-trade program. The clean-energy standard they used is similar to the carbon dioxide emissions reductions proposed in the EPA’s Clean Power Plan, which the agency proposed in June. The plan enforces tighter emission guidelines for power plants. As the EPA points out, “for every dollar invested through the Clean Power Plan, American families will see up to $7 in health benefits.”

The MIT researchers calculated the health care savings by looking at avoided medical care and sick days. They also noted how changes in emissions levels reduce air pollution, which can cause asthma attacks and lead to heart and lung disease. In 2011, 231 U.S. counties had ozone pollution levels that were higher than the EPA’s standards. And in 2012, air pollution caused around 7 million global deaths, making it the world’s largest environmental health risk, according to the World Health Organization.

The researchers found that savings from reduced health problems due to lower pollution levels can reach 10.5 times the cost of implementing the policy. The health care savings were about the same for each of the policies, but the total savings depended on how much the policies themselves cost. The transportation policy, which would regulate the miles-per-gallon that consumers could use, was the most expensive policy; reduced health care expenditures mitigated only 26 percent of its cost. But savings from health benefits were up to 10.5 times the price of implementing a cap-and-trade program. Savings from a clean energy standard were also more than the cost of creating that program, with $247 billion saved versus its $208 billion price tag.

But health isn’t the only reason that the EPA has emphasized that the United States needs a strong emissions reduction plan. Global temperatures continue to rise, which will make extreme weather even worse. The costs of dealing with these natural disasters will also continue to rise.

Congress has not taken any action in reducing carbon emissions, which isn’t too surprising, as many politicians still don’t think Americans should be worried about global warming.

But more than half of Americans support the EPA’s carbon reduction proposal.

AFP Photo/Patrik Stollarz

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Coal Industry Fuels Republican In N.C. Senate Race

Coal Industry Fuels Republican In N.C. Senate Race

By Renee Schoof, McClatchy Washington Bureau

WASHINGTON — Money from coal companies has been fueling North Carolina Republican Senate candidate Thom Tillis’ race to unseat Sen. Kay Hagan (D-NC) including $21,100 from the nation’s largest privately owned coal company.

The contributions came from the Ohio-based Murray Energy Corp. The owner and founder, Robert E. Murray, is a major backer of Republican candidates and a fierce opponent of President Barack Obama and the Environmental Protection Agency, especially over a proposal that would limit heat-trapping emissions from coal-fired power plants.

Murray Energy is Tillis’ fifth largest contributor, having received money from the owner, company officers, employees, and family members, and the company’s political action committee, according to the Center for Responsive Politics, a nonpartisan campaign finance watchdog group.

The coal industry has not been a major political donor of Hagan’s, who is seeking a second term. But Duke Energy, the Charlotte-based power company that relies on coal as source of fuel, has been among her top 20 financial contributors.

The company’s employees, lobbyists, and political action committee have given her $20,400 between 2007 and 2014, the Center for Responsive Politics reported.

Tillis received the $21,100 from Murray and related individuals in the first quarter of this year. In all, company employees have given $522,093 to political candidates across the country in 2013 and so far in 2014.

All of the contributions from Murray Energy this campaign cycle have been to Republicans, except for $2,500 to Sen. Mark Warner (D-VA), who’s running for re-election this year. Sen. Tim Scott (R-SC), who’s also running in November, has received $21,850.

Some Murray executives listed their occupation on the Federal Election Commission forms as “coal miner.” One of them, Ronald D. Koontz, is general manager of the Ohio Valley Coal Co., a Murray subsidiary, according to a 2012 company news release. He donated $1,000 to the Tillis campaign, part of more than $13,000 he has given to Republican candidates since 2013, according to the Center for Responsive Politics. Koontz did not answer calls for comment.

Wayne E. Conaway Jr., of Farmington, W.Va., who works in Murray Energy’s safety department, said he gave $375 to Tillis because Tillis supports coal. He said the company emphasized to employees that “we’ve got to get out and protect our livelihood.”

“We have no comment,” said Gary Broadbent, Murray Energy’s media director and assistant general counsel, in response to questions about the company’s support for Tillis.

But in a message on the company’s website, Robert Murray, who founded the company in 1988 with the purchase of a single mine, said his industry is “embattled from excessive federal government regulations and, to a lesser extent, by the increased use of natural gas for the generation of electricity.”

He added: “In my fifty-seven years of coal mining experience, I have never before seen the destruction of an industry that we are witnessing today, with reliable, low-cost electric power also being eliminated.”

In June, Murray Energy filed the first lawsuit against the EPA to try to block the rule on power plant emissions limits. The suit asked the U.S. Court of Appeals for the District of Columbia to prevent the EPA from implementing what the company said in a news release was “this illegal and disastrous rule on electric power generation.”

Twelve states filed a separate lawsuit against the administration on Aug. 1 in another attempt to stop the proposed rule: West Virginia, Kentucky, Alabama, Indiana, Kansas, Louisiana, Nebraska, Ohio, Oklahoma, South Carolina, South Dakota, and Wyoming.

Murray also has disagreed with the scientific view that the burning of coal and other fossil fuels is the main reason for warming of the planet. In an interview with West Virginia Executive Magazine for a story published in May, he was quoted as saying the Obama administration was lying about global warming. Murray contended that the Earth was cooling.

The company has 12 coal mines in Kentucky, West Virginia, Ohio, Illinois, Pennsylvania, and Utah and employs more than 7,300 people.

In 2007, a collapse at the company’s Crandall Canyon Mine in Utah killed six miners. Three more people died 10 days later in a rescue attempt. Murray subsidiaries agreed in 2012 that violations contributed to the accident, including improper mine design. The subsidiaries paid $1.15 million, which covered penalties for the collapse and the settlement of other violations at other Utah mines.

Besides Murray Energy, other coal company and mining industry political action committees have contributed to Tillis. Alliance Coal’s LLC PAC gave him $5,000 in June. Federal Election Commission records also show $10,000 from two PACS of the National Mining Association; $1,500 from the PAC of Arch Coal, Inc.; $2,000 from the Alpha Natural Resources, Inc. PAC; and $2,000 from Patriot Coal’s PAC.

Other coal company executives and employees also made individual contributions.

North Carolina in 2013 got 38 percent of its electricity from coal, according to the latest data from the U.S. Energy Information Administration.

Photo via WikiCommons

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