Electricity bills will skyrocket and the economy will suffer under soon-to-be-released air quality standards for coal-fired power plants, industry advocates predicted Monday, offering a preview of the coming battle over emissions requirements between coal backers and the Obama administration.
Those comments, echoed widely by utility representatives, mining interests and state regulators at an energy summit in Casper, came several weeks before the U.S. Environmental Protection Agency is expected to release new limits on carbon dioxide emissions from existing coal-fired power plants.
The new rules are widely anticipated to place greater restrictions on the amount of carbon dioxide coal plants can release into the atmosphere each year and represent a centerpiece of the president's attempt to address global climate change.
"We anticipate it to be unprecedented in complexity and cost," said Dan Byers, senior director for policy for the U.S. Chamber of Commerce’s Institute for 21st Century Energy.
Previous attempts to regulate air quality under the Clean Air Act focused on specific pollutants, such as mercury or particulate matter, their source and eliminating them from the local environment, Byers said.
Carbon dioxide emissions, by contrast, are global, meaning what is emitted in China impacts the United States and vice versa, he said. Any carbon reductions in the U.S. resulting from the rule will be negated by increased coal consumption in Asia. American companies, meanwhile, will be left at a disadvantage, as their Asian competitors use a lower-cost fuel source, Byers argued.
Byers was one of four panelists to take up the subject of the new EPA rules, which are expected to be released on June 2, at the Wyoming Energy Summit.
The two-day event, hosted by the Wyoming Business Report, featured a keynote speech by Gov. Matt Mead and a series of panel discussions on everything from coal exports to oil-by-rail transportation to the future of the uranium industry.
But in a state that collects $1.2 billion in biannual coal revenues, much of the early discussion centered around the coming EPA rules and what they might mean for the industry.
"Really what our interest is, is that this rule doesn't shut down existing coal plants and coal mines," said Barbara Walz, vice president of compliance at the utility Tri-State Generation and Transmission Association.
A separate rule, which would essentially require new coal plants to be as efficient as natural gas facilities, effectively mandates utilities use carbon capture technology to meet EPA's regulations, Walz said. Such technology is expensive and would cause wholesale electricity costs to rise 70 to 80 percent initially, she predicted. Costs will fall after the carbon capture technology is improved, but they are still projected to be 30 to 40 percent higher than where they are now, Walz said.
Steve Dietrich, administrator of the Wyoming Department of Environmental Quality's Air Quality Division, said EPA regulations typically require power plants to install the best available technology to curb pollution. The new rule is different because it essentially forces companies to deploy a technology that has yet to be commercially proven, he said.
It has taken EPA nearly 40 years to implement a rule passed in the 1970s aimed at curtailing smog, said Richard Garrett, an energy policy analyst at the Wyoming Outdoor Council, a Lander-based environmental group.
Given that track record and the costs involved in upgrading existing coal plants, it will likely be a long time before EPA implements the new coal rules in earnest, he said in an interview after the discussion.
"I would like to see bigger steps, bolder steps," Garrett said. "Climate change is upon us and it will become a bigger and bigger burden for our children."