by James A. Bacon
Virginia dodged a bullet today: In final rules for its Clean Power Plan, the Environmental Protection Agency (EPA) has significantly scaled back its carbon intensity goals for Virginia’s electric power sector. The final rule establishes an interim goal of 1,047 pounds per megawatt hour of electricity produced for the period 2022-2030. That compares to the interim goal of 884 pounds set for Virginia in the initial goal proposed last year.
Dominion Virginia Power, the State Corporation Commission and the McAuliffe administration all argued that the goals gave insufficient recognition to progress Virginia had made in recent years in driving down the carbon intensity of its electric power system. The SCC had estimated that implementation of the rules would cost $6 billion for Dominion alone, not including the impact on Appalachian Power Co. or Virginia’s electric cooperatives.
The roll-back represents a significant victory for Governor Terry McAuliffe, who had lobbied EPA Administrator Gina McCarthy to give consideration to Virginia’s previous progress in replacing coal-fired power plants with natural gas, which, though a fossil fuel, releases less CO2 per unit of electricity generated than does coal. Virginia has reduced CO2 emissions 16% since 2008, according to the EPA’s own data.
The new EPA guidelines were well received by Virginia’s largest electric utility. “The compliance targets for Virginia have moved in a positive direction that fairly recognizes the role of natural gas generation in reducing emissions,” said Thomas F. Farrell II, Dominion CEO in a prepared statement. “I commend Administrator McCarthy for making critical changes to the proposed rule.”
In remarks today, President Barack Obama described the Clean Power Plan as “the single most important step America has ever taken in the fight against Climate Change.” The plan, he says, is aimed at ending “the limitless dumping of carbon pollution from power plants.”
Environmental groups were supportive of the final rules. “The reality is that the strategies to meet the Clean Power Plan reflect the energy shift already under way in our states: We’re embracing smarter, cleaner, cheaper energy options that would be happening with or without this plan,” said Frank Rambo, senior attorney with the Southern Environmental Law Center (SELC). “As a result, our states are well-positioned to meet these reasonable and inevitable pollution reduction targets.”
Appalachian Power Company is still reviewing the 1,600-page rule, so it cannot yet say whether it is reasonable or not. Extending the initial compliance target to 2022 is a “positive,” said John E. Shelpelwich in the company’s corporate communications office, but “simply moving the date forward a few years won’t be enough to address the negative reliability impacts if the initial reduction targets are still too stringent. … Any plan to effectively reduce greenhouse gas emissions must be accompanied by a thorough assessment of the impact on the electric grid.”
The new, less draconian CO2 emissions for Virginians likely means that electric rates will not jump as much as the SCC had previously anticipated, if they rise at all. As the SELC and other environmental groups frequently noted, Dominion was already on track to meeting 80% of the draft goals, thanks to major investments the company had made to meet a previous round of EPA rules designed to reduce toxic emissions. While some states fought those rules, Virginia complied by shutting down, or scheduling the shutdown, of several coal- and oil-powered electric generating units and building cleaner gas-fired units in their place.
“The final rule is complex and will require further study,” stated a Dominion press release, but the company is encouraged by the easier CO2 emission targets and the extra time given to achieve them. Dominion also stated that it was “pleased” that the final EPA rule recognized the environmental benefits of natural gas and its ability to backup intermittent renewable fuels such as sun and wind. The company’s main reservation: The rule “falls short” in acknowledging the value of zero carbon-emitting nuclear generation.
Note: This article has been updated to include a response from Appalachian Power Co.
