A version of this post appears on National Journal’s Energy Experts page.
Last week I debated the Heritage Foundation on Fox Business about the EPA’s proposed rules over new fossil fuel power plants, in a segment subtly titled “Will EPA rules bankrupt the coal industry?”
The rules not only follow the John Roberts’ Supreme Court mandate to regulate greenhouse gas emissions, but recognize that competing technologies have eclipsed coal in terms of efficiency. A new combined cycle natural gas plant features capital costs of $764 million and levelized generation costs of $50.24/MWh—that’s capital costs 75% cheaper than scrubbed pulverized coal and 43% less expensive levelized generation costs than coal. Coal was the workhorse of the power industry for so long because it was cheap and more efficient than its rivals, and because we didn’t care about or fully understand the environmental costs. But new coal is no longer competitive, and these EPA rules simply enshrine the Supreme Court mandate for coal to better account for its environmental costs.
But during my Fox debate, the Heritage Foundation argued that the proposed rules would increase costs to consumers, while failing to provide any documentation. While there are expected to be costs to consumers for rules over existing plants (to be drafted beginning 2014), there is time to develop tools to mitigate those costs. But we do not expect there to be costs to consumers for the rules over new power plants. What Heritage did was to intentionally mislead the public by conflating these proposed rules for plants not yet built with future rules for existing power plants. And, unfortunately, that’s the type of fact-challenged rhetoric that passes for policy analysis these days.
Some utilities, with management styles enshrined with state utility commissions, lack the acumen to efficiently respond to changing market dynamics. They remain beholden to outdated supply chains that led them to believe that they must continue to stick with coal, economics be damned.
I’m sure the Heritage Foundation didn’t lament the demise of the US typewriter manufacturing industry. But to see Heritage and others pump out false information about proposed public health rules mandated by the John Roberts Supreme Court is simply the reflection of vested, outmoded utility interests expecting to stick ratepayers with inefficient generation systems for another 50 years. Consumers deserve better.
Tyson Slocum is Director of Public Citizen’s Energy Program. Follow him on Twitter @TysonSlocum