US Chamber of Commerce Blog
Word of advice to the EPA: “Don’t mess with Texas.”
Texas will see higher electricity prices and a greater likelihood of power disruptions from EPA’s carbon regulations, the Lone Star State’s power grid reliability monitor warns:
President Barack Obama’s plan to fight climate change will force at least 4,000 megawatts of coal-fired power in Texas offline, pushing energy prices higher and increasing the risk of blackouts, according to the state’s grid operator.
Electricity bills may jump by as much as 16 percent by 2030 as a result of the Environmental Protection Agency’s Clean Power Plan, grid operator Electric Reliability Council of Texas Inc. [ERCOT] said in a report posted on its website Friday. Texas joins other grid managers and utilities that have warned of higher prices and reliability issues from plant closures if the plan is finalized.
“This amount of unit retirements could pose challenges for maintaining grid reliability,” Ercot said. “Impacts are likely to intensify and occur earlier when the effects of the CPP are combined with other environmental regulations.”Higher Electricity Prices
Forcing a shift away from coal-generated power will mean higher electricity prices, the report states:
The CPP will also result in increased wholesale and retail energy costs in the ERCOT Region. Based on ERCOT’s analysis, energy costs for customers may increase by up to 16% by 2030 due to the CPP alone, without accounting for the associated costs of transmission upgrades, higher natural gas prices caused by increased gas demand, procurement of additional ancillary services, and other costs associated with the retirement or decreased operation of coal-fired capacity in the ERCOT Region. Consideration of these factors would result in even higher energy costs for customers.
When presidential candidate Obama said electricity prices would “skyrocket” under his watch, he really meant it.Less Reliable Power Grid
Texas electricity users will also be paying more for a less-reliable power system.
Coal-fired power plants supply 18.9% of electricity in the ERCOT system, which covers about 75% of Texas. By 2030 ERCOT estimates that share could fall to as low as 14% with natural gas, wind, and solar making up the difference.
“The retirement of legacy coal-fired generation could result in localized reliability issues and require transmission system upgrades,” ERCOT warns.
State plans for how to cut carbon emission are due by 2018, and they must meet their first targets by 2022.
However, the report points out, “[I]t takes at least five years for a new major transmission project to be planned, routed, approved, and constructed.” In the case of constructing 3,600 miles of power lines to connect the Texas Competitive Renewable Energy Zones to the grid, it took nearly a decade and cost $6.9 billion.
ERCOT is being conservative. Transmission projects often take 7-10 years to complete.
Either way, there isn’t enough time for any state to implement a plan to drastically reconfigure its power grid.
As Texas’ situation shows, EPA’s carbon regulations should be scrapped. They’ll be all pain for no gain.
Joby Warrick of The Washington Post asks a strange question: If it’s President Obama’s mission to reduce carbon emissions, why is the federal government allowing coal to be mined on federal land and exported?
The answer is obvious and hidden in plain sight in the graphics package that accompanies Warrick’s story: Increasing world demand for electricity.
This chart shows from 1980 to 2012, world electricity production from coal increased by 192%. Forty percent of electricity is generated from coal.wapo_world_coal_generation_800px.jpg Washington Post chart on world electricity generation.Source: The Washington Post.
World demand for electricity will increase for decades to come. “In sub-Saharan Africa, where just 24 percent of the population has access to electric power, demand is likely to grow exponentially in the years ahead,” notes the Post. In India, with its middle class expected to grow to 200 million by 2020, Robert Bryce at the Manhattan Institute points out, “India’s coal use is expected to more than double by 2035.”
Being a cheap, abundant source of energy, coal can fuel countries that strive to live lifestyles as comfortable as ours in the United States. Can’t say I blame them.
Stephen Eule at the Institute for 21st Century Energy quotes Piyush Goyal, Indian Minister for State for Power, Coal, and New & Renewable Energy:
Just as in all other countries, including the developed world, coal will continue to remain the mainstay of our energy related needs for the foreseeable future. In all fairness, it would not be correct to say or to expect India to move away from coal when we are at the cusp of our developmental journey.
According to the World Coal Association, there are more than 2,300 coal fired power plants planned or under construction worldwide. They will provide electricity access to millions of people, greatly improving their lives. These plants will be built and burn coal no matter what coal opponents do.worldcoalassociation_coal_plants_planned_underconstruction_800px.png World Coal Association chart on coal power plants planned and/or under construction. Source: World Coal Association.
Given this, “What taxpayers are being helped by denying the United States — with the biggest coal reserves in the world — the fastest-growing markets for coal in the world?” Luke Popovich of the National Mining Association, asked in the Post story.
Good question. Even though the administration is very wrong on its carbon emissions regulations, it at least acknowledges coal’s important role. Warrick quotes Interior Secretary Sally Jewell: “Coal is, and will continue to be, an important part of our energy mix for the foreseeable future." In the U.S., coal still generates nearly 35% of all electricity.
Coal has been a valuable energy source for thousands of years and will continue to be so in the decades ahead. Putting up barriers to both domestic coal use and exports denies this reality.
Environmental activists who oppose hydraulic fracturing—and the oil and natural gas it produces—have more science to ignore. The latest study is in the Proceedings of the National Academy of Sciences. A team, led by a Yale University researcher, looked at 64 natural gas wells in Pennsylvania three to five years after drilling and found:
There was no evidence of association with deeper brines or long-range migration of these compounds to the shallow aquifers.
In laymen’s terms, the act of drilling thousands of feet below the surface (far below drinking water supplies) and hydraulically fracturing natural gas wells does not contaminate drinking water.Hydraulic fracturing: How it works
Another way of putting it is: Josh Fox doesn’t know what he’s talking about.
Add this study to the growing list of research confirming that hydraulic fracturing is a safe way to develop energy:The Energy Department looked at wells in the Marcellus Shale and found that neither natural gas nor hydraulic fracturing fluid traveled upward through the rock. EPA found hydraulic fracturing has not had “widespread, systemic impacts on drinking water.”
It's no wonder that Secretary of Energy (and physicist) Ernest Moniz said, “To my knowledge, I still have not seen any evidence of fracking per se contaminating groundwater.”
This reminds us that states are successfully regulating hydraulic fracturing. Duplicative federal regulations aren’t needed. Also, states and local governments should rethink their bans on the technology.
When done properly hydraulic fracturing produces abundant energy that powers the American economy, creates jobs, and saves consumers money.annual_household_savings.jpg Annual household savings from shale energy.Source: Harvard Business Review and the Boston Consulting Group.
[H/t Ron Bailey at Reason.com.]