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.