When the EPA laid out its plan for
reducing carbon emissions from electrical generating plants last June, Montana
got something of a get-out-of-jail-free card.
The EPA’s Clean
Power Plan calls on every state to reduce its carbon emissions rate –the amount of carbon it dumps in
the atmosphere per megawatt hour of electricity it produces - with some states
reducing rates quite a bit and others, like Montana, very little. Specifically, the EPA wants us to reduce our
rate by just 21%, which is less than what’s expected from all but a handful of
states, as you can see from the map.* And as the Montana Department of
Environmental quality reported in a white
paper last month, we can achieve this rate reduction without reducing actual
emissions very much at all; Montana’s coal fired power plants can continue to
operate much as they have in the past and burn about the same amount of coal.
The DEQ white paper left many of
the people who worry a lot about climate change (I’m one of them) mystified and
a little disillusioned. How could a plan that was supposed to reduce US emissions
by 30%** possibly leave coal unscathed? Why didn’t the EPA expect Montana to do
more? And even if the EPA doesn’t think so, shouldn’t we do more anyway?
Shouldn’t DEQ design some implementation scenarios that would make that happen?
The answer to the first question
is pretty simple: What happens to coal is going to depend mainly on the
implementation plans of the states that burn it, rather than the states that
dig it out of the ground. Montana does some of both, of course, but a big part
of Montana’s coal is sold to other states, and how they decide to control their
emissions will determine how much coal they’ll want to buy in the future. There
are a lot of unknowns here, but since total US power sector emissions need to
decline by about 15% between now and 2030 to meet the EPA goal, it seems safe
to conclude that the market for coal – including Montana’s - will contract
slowly, but hardly disappear.
Why the EPA expects so little
from Montana is a more complicated matter. To determine how much a state could
reasonably be expected to reduce its emission rate, the EPA calculated how much
the state could take advantage of four different “building blocks,” or
strategies, to come up with a best system of emissions reductions (BSER in the
jargon). These building blocks – which included more production of renewable
energy, greater efficiency both in burning coal and in using electricity, and
shifting generation to less polluting natural gas plants – were all ones that
the EPA deemed both technically feasible and available at reasonable cost. So
the EPA’s goal for Montana – the 21% reduction in our emissions rate – reflects
what the agency thinks it’s actually possible for us to do at reasonable cost.
And the reason that we are able to do relatively little is that we’re lacking
one of the building blocks – the shifting of electrical generation to cleaner
natural gas plants – for the simple reason that we have no natural gas plants
to shift to.
There is then a method to the EPA’s
madness in assigning the wide range of emission rate reductions you see on the
map, and it’s this: if you required all states to reduce their emissions
equally, some states, among them Montana, would be forced to resort to
strategies, such as sequestration, that are believed to be costly and not very
reliable. And making some states pay a lot for emissions reductions, while
other states could do the job for much less, doesn’t make economic sense.
But bear in mind that the EPA is
not requiring that states use only the four building blocks it has identified.
On the contrary: a state can employ almost any strategy it wants to hit its
emissions reduction target; those possible alternative strategies are what DEQ
is running up the flag pole in its white paper. EPA appears to recognize that a top-down, one-size-fits-all BSER, making use of only the four building
blocks, will often not be a good match for a particular state, either because it
has available some effective, low cost way of reducing emissions that’s not one of the building blocks, or because
it is willing to follow a higher cost strategy in order to protect some special
interest. Protecting the coal industry
by relying on sequestration would be an example.
DEQ gave us five possible
scenarios that would get us to Clean Power Plan compliance, as well as a
planning model that lets folks come up with more scenarios of their own. Going
forward, there are going to be people who will want us to reject the Clean
Power Plan in any way, shape or form, out of hand. The rest of us have to take
advantage of the flexibility we have been accorded to come up with a compliance
plan that is low cost, equitable and allows us to make a meaningful
contribution to reducing emissions and arresting climate change.
* I clipped this map from NERA
Economic Consulting’s report, PotentialEnergy Impacts of the EPA Proposed Clean Power Plan.
** This is the EPA’s estimate of
the reduction in emissions from the electric power sector that will occur
between 2005 and 2030 if the plan is implemented. But because emissions have fallen
about 15% since 2005, we are already half way to the EPA’s 2030 goal; the
regulations are designed to get us the rest of the way.
