Seven CEOs—from Exelon, Great Plains Energy, National Grid, NRG Energy, Duke Energy, FPL Group, Great River Energy—explain how global warming is affecting their customers, shareholders, and...
EPA, mercury and electric reliability.
New England’s who indicated that they’ve got procedures in place to handle these things, we will monitor that.
But we don’t think we need to, you know, get in-depth into their planning activities, and we believe that they’re reliable and capable to handle them.
Wellinghoff’s performance nearly stopped the show. He found no evidence of any threat to reliability serious enough to warrant a blanket waiver or exemption from MATS compliance. Instead, Wellinghoff favored the “safety valve” solution proposed by five RTOs, whereby EPA could allow individual units to continue to run, even if unable to meet the MATS compliance deadline, if needed to maintain reliability. FERC, presumably, would issue any required finding.
Wellinghoff’s frequent foil, commissioner Philip Moeller, found the safety valve idea interesting as well, but questioned whether FERC would have a role to play, as the decision on whether to grant an extension ultimately would fall to EPA.
And speaking of EPA, Moeller wondered out loud why Regina McCarthy, the EPA’s assistant administrator for the office of air and radiation, had been permitted to address the conference at the top of the hour, ahead of the panel, but then had been excused and thus saved from cross-examination by the commissioners during the Q&A session—especially after she had impugned any and all who might doubt EPA’s motives on the cross-state mercury and toxics rules.
“We have heard claims that our rules will lead to adverse impacts on energy reliability,” McCarthy noted.
“Well rest assured … in the 40-year history of the Clean Air Act, EPA rules have never caused the lights to go out, and the lights will not go out in the future as a result of EPA rules.”
McCarthy acknowledged that a number of studies had predicted widespread plant retirements, but found the studies marked by “serious flaws,” including the NERC LTRA already noted, which she said had wrongly assumed that coal units would install the most expensive controls available, and also “mischaracterized” EPA’s cooling water intake rule under Clean Air Act sec. 316(b), which McCarthy said “accounts for the majority of the retirements that NERC specifies.”
McCarthy conceded that EPA had never denied the chance of “localized reliability challenges,” but that widespread rumors of disaster were unrealistic and wouldn’t lead EPA to back down.
“I may be bullet-riddled,” she admitted, “but frankly, you can’t see any holes.”
Timing is Everything
The record is rife with evidence on how much coal-fired capacity will be retired or placed out of service for retrofits to comply with the EPA’s MATS rule.
As outlined in comments and testimony submitted for the FERC conference, the Midwest ISO expects that 62,000 MW of its 72,000 MW of coal-fired capacity will require retrofits or replacement, with 28,000 MW requiring fabric filters, and 20,000 MW requiring added scrubber-type control equipment. Southern Company anticipates that 58 of its 64 coal-fired generating units will have to undergo major changes to comply with EPA rules. And absent any extension in EPA’s compliance deadlines, Southern projects a negative-12 percent reserve margin in 2015, recovering to positive territory