Electric industry restructuring is progressing at a rapid pace. Across the country, states are moving ahead to encourage retail competition. Two states have allowed retail wheeling experiments (...
Massachusetts Institute of Technology, favors just such an approach. He says the acid rain trading program was undeniably successful. "Just look at the data, there has never been a reduction of emissions as swift, as great as what we've observed under Title IV [the acid rain program]. I just think the facts speak for themselves." As for the Bush Clear Skies plan, he says "it is a very aggressive proposal by any stretch of the imagination," and one that will reduce emissions.
The critical element to the Clear Skies plan, Ellerman says, is the new source review. "[T]hat's what all the argument is about. You've got industry willing to support these deep cuts, if in fact we can fix new source review." According to Ellerman, disputes over NSR, including lawsuits and administrative wrangling, is impeding re-powering plants, and putting more power in the same footprint as old plants. "It should be understood, I don't think the administration or industry will support these caps without NSR reform."
The costs to achieving such reductions will be significant, he says. "You have to think that the existing emissions reduced SO 2 emissions 50 percent from what they were, so you're really ratcheting down these, and it is going to cost more."
As Duke Energy spokeswoman Becky McSwain says, most people "assume that most of the low-hanging fruit has been picked, and that every increment of reduction gets harder and harder to do."
But Silva disputes industry claims that emission reductions outlined in the Clear Skies plan will take 16 years, and that tougher standards implemented more quickly are beyond realistic reach. Currently, utilities emit around 5 million tons of NO x annually. According to an EPA analysis on multi-pollutant control strategies released in Sept. 2001, the agency anticipated that industry could affordably reduce NO x emissions to around 1.2 million tons by 2010.
EPA has since backed away from those September numbers, saying that they were not intended to be projections. Instead, officials said that the numbers were meant to compare a multi-pollutant strategy with the current piecemeal regulatory approach to emissions control.
Indeed, EPA's new posture on its September numbers hints at conflicts within the administration over the proper reduction targets. Silva says the administration appears conflicted. "This is a schedule, and these are reduction targets and timelines dictated by the industry to the DOE, which in turn carried the water on behalf of the industry within the administration, and made over this approach."
But David Mitchell, public affairs for Duke Energy, disagrees. "There has been a lot of good, sound debate between the Department of Energy and the EPA, but I think that the proposal the President announced on Feb. 14 is the consensus result of those internal debates within the administration," he says.
Silva questions assertions that tougher targets will be impossible to meet. "We currently emit around 11 million tons of SO 2 today, and [the Bush plan] proposes to reduce that by 2010 to 4.5. And then, a further reduction down to 1.5 million to 3 million by 2018. The