WASHINGTON – A new analysis by a global economic consulting firm is projecting “significant negative economic impacts” to West Virginia under a proposed plan by the federal Environmental Protection Agency to regulate carbon dioxide emissions from existing fossil-fuel power plants.
National Economic Research Associates Inc., or NERA, released its findings last week.
Under the EPA’s proposal, new large natural gas-fired turbines would need to meet a limit of 1,000 pounds of carbon dioxide per megawatt-hour, while new small natural gas-fired turbines would need to meet a limit of 1,100 pounds of carbon dioxide per megawatt-hour.
New coal-fired units would need to meet a limit of 1,100 pounds of carbon dioxide per megawatt-hour, and would have the option to meet a somewhat tighter limit if they choose to average emissions over multiple years, giving those units additional operational flexibility.
NERA projects that the costs to comply with the agency’s proposed plan could total $366 billion, or more, in today’s dollars.
Electricity rates could face a peak-year increase of 14 percent in West Virginia, alone, NERA found.
In its proposal, the EPA has tasked the Mountain State with a carbon emissions reduction target of 20 percent by 2030.
“The President’s regulatory crusade to be a global leader on climate change is plagued with problems,” said Mike Duncan, president and CEO of the American Coalition for Clean Coal Electricity. “For starters, it is exorbitantly expensive and will result in marginal global benefits. Then there is the inescapable fact that the proposed rule will drive up energy costs and threaten to idle America’s burgeoning manufacturing renaissance. Finally, adding insult to injury, other world leaders are rejecting the President’s plan as they fear putting their own countries into an economic tailspin.
“I have one thing to say to the President – pull this rule before irrevocable consequences
hit American people and businesses.”
NERA’s analysis found that 43 states will face double-digit electricity price increases, with 14 states potentially facing electricity price increases that exceed 20 percent.
What’s worse, according to the consulting firm’s study, is that the EPA’s proposal will have an essentially meaningless effect on global climate change.
According to NERA, atmospheric carbon dioxide concentrations would be reduced by less than one-half of a percent, equating to reductions in global average temperature of less than 2/100th of a degree, and sea-level rise would be reduced by 1/100th of an inch – equal to the thickness of three sheets of paper.
In addition, NERA projects that consumers and businesses could face costs as high as $41 billion or more per year.
Much of NERA’s cost projection, it noted, is based on consumers having to spend more than $500 billion to reduce their use of electricity.
The analysis also found that the EPA’s proposal could shutter 45,000 megawatts or more of coal-based electricity, which is more than the entire electricity supply of New England.
West Virginia receives 95 percent of its electricity from coal.
West Virginia Attorney General Patrick Morrisey said last year he is “very concerned” about the EPA’s carbon reduction plan, calling it “reckless.”
“I’ve seen little from the White House or the EPA on what people in Boone, Marshall, Logan, Marion, Mingo, Monongalia and other counties around the state should do when their local coal mines have layoffs,” the attorney general said at the time.
“Based on this proposal, I cannot see how anyone could question the EPA’s intention to take coal out of the equation.
“West Virginia cannot idly sit by and allow politicians and bureaucrats in Washington, D.C., to cripple our economy.”
A number of groups also are concerned about the EPA’s proposed plan, and have come out in support of NERA’s new research: the American Farm Bureau Federation, American Fuel and Petrochemical Manufacturers, Association of American Railroads, Consumer Energy Alliance, Electric Reliability Coordinating Council, National Mining Association and the American Coalition for Clean Coal Electricity.