Electric Co-op Today

NRECA has petitioned a federal court for review of the Environmental Protection Agency’s new rule governing emissions of nitrogen oxides and sulfur dioxide that cross state lines.

Utilities say a new Environmental Protection Agency emissions rule is rife with errors that could affect reliability and affordability. (Photo By: Oglethorpe Power Corp.)

The association filed an Oct. 7 lawsuit in the U.S. Circuit Court of Appeals for the District of Columbia, seeking review of the Cross-State Air Pollution Rule (CSAPR). It is scheduled to take effect Jan. 1.

At the same time NRECA also filed a petition for reconsideration of the Cross-State Rule with EPA, seeking administrative review of the sweeping regulations on numerous procedural and substantive grounds.

The rule contains serious flaws that will lead to increased electricity prices and raise doubts about whether EPA will accomplish its goals, NRECA said.

“By revising CSAPR to consider issues identified in this petition, the environmental benefits of the rule would be essentially unchanged, while the cost savings to a significant portion of the nation’s rural electric consumers would be great,” according to the EPA comments filed by Rae Cronmiller, NRECA environmental counsel.

The rule is the successor to the Bush-era Clean Air Interstate Rule, which a federal court struck down in 2008, although it allowed its provisions to stand while EPA rewrote its regulations.

It applies to 27 states, mostly east of the Mississippi, and sets limits aimed at reducing airborne emissions, ozone and particulate matter that contribute to soot and smog.

The rule relies on a system of tradable allowances for states and generating units to meet required emissions reductions. EPA expects it to cost utilities $800 million a year by 2014.

NRECA said cooperatives did not have an adequate opportunity to comment on several important aspects of the final rule because EPA didn’t include them in its initial 2010 proposal. Many of EPA’s calculations are suspect, and badly shortchange some G&Ts and other utilities on the allocation of allowances, NRECA added.

For example, under EPA’s plan, San Miguel Electric Cooperative, Christine, Texas, falls far short of the tradable allowances it needs, leaving it with the choice of purchasing overpriced allowances in the market―if they are available― or reducing generation at its coal-based plant by 14 percent.

“In short, meeting the requirements of CSAPR will be very costly to San Miguel’s 26 member cooperatives and its more than 550,000 electric cooperative consumer-members,” NRECA said.

Similarly, South Mississippi Electric Power Association, Hattiesburg, is projecting a 224-megawatt generation capacity deficit in 2012―and more in future years―because of EPA’s unrealistic compliance timetable and the lack of available allowances, NRECA cautioned. SMEPA has also filed a lawsuit against EPA.

Tags: Cross-State Air Pollution Rule, Environmental Protection Agency, Ozone