EPA’s Coal-State Impact Less Than Certain
[imgbelt img=emissions_change.png ]The “War on Coal” rhetoric has ramped up in response to the EPA’s proposed rule on reducing greenhouse gas emissions from power plants. The Kentucky Center for Economic Policy’s Jason Bailey says the numbers tell a different story.
[imgcontainer][img: emissions_change.png][source]EPA/Compiled by the Kentucky Center for Economic Policy
Chart shows the percentage reduction in emission rates for each state under the proposed power-plant rule. The top five coal-producing states (Wyoming, West Virginia, Kentucky, Pennsylvania and Illinois) are shown in yellow. (Click chart to enlarge.)
The Environmental Protection Agency has announced its proposed new power plant rules designed to address the growing threat of climate change, and the angry rhetoric from some Kentucky political leaders has come quick and fierce. Their refrain is that coal—which Kentucky mines and depends on for more than 90% of its electricity—is being unfairly targeted in this new front of the “War on Coal.”
But the exact impact of the new rules on Kentucky and other top coal-producing states is more complicated and uncertain. EPA designed the rules to differentiate between states on the basis of their existing power supply and resource opportunities and aims to achieve a 30% carbon reduction goal by 2030 in the most cost-effective way.
While most states will have to reduce their emissions rate more than 30% over that time period, Kentucky will have to cut its rate only 18%. Wyoming, by far the biggest coal-producing state, will be required to reduce its emissions by 19%. And second-place coal producer West Virginia will be required to reduce its emissions by 20%. (See the chart above.)
The plan also introduces flexibility to states in how they meet the reductions and gives them a longer time frame to cut their emissions than many expected.
The overall hit to U. S. coal generation from the new rules is not that stark. EPA projects that coal will generate 30% of the nation’s electricity in 2030 compared to 39% in 2013. To put that in context, coal’s share was 48% as recently as 2008 but has fallen because of cheap natural gas.
While some state political leaders are outraged, utility leaders aren’t yet raising big alarms. Some are even saying that the new rules aren’t as tough as they expected. Indeed, the recommendations in many ways mirror the proposal Kentucky energy secretary Len Peters sent to the EPA last year.
Claims from politicians that the new rules will devastate Kentucky’s electricity-intensive manufacturing sector are far from proven. Much more concerning for the state’s factory jobs are the federal trade and economic policies that have wiped out more than one-fourth of the state’s manufacturing employment since 2000. And the shifts in energy use that will result from the rules could also create jobs. Research done by Synapse Energy Economics for my organization a few years ago suggested Kentucky could create upwards of 20,000 jobs in 10 years from increasing energy efficiency—which we’ve neglected in the past because of our cheap power rates—and expanding renewable energy.
[imgcontainer][img: datapointemissions.png][source] EPA/Compiled by Kentucky Center for Economic Policy
This chart graphs the emissions cap and percentage reduction in emissions for each state by 2030. The top five coal producing states are shown in yellow dots. (Click the chart to enlarge.)