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New carbon dioxide rules will affect Ohio

EPA is expected to propose changes on Monday

Rules that will for the first time limit carbon dioxide emissions are likely to have a big impact in coal-dependent Ohio.

The U.S. Environmental Protection Agency is expected on Monday to issue the proposed rules, which will then go through a period of public comment and culminate in final rules. States would then have to submit plans to the feds on how they will reduce emissions of carbon dioxide, a byproduct of the burning of fossil fuels to produce electricity.

The details of the proposed rules are a closely held secret and EPA spokeswoman Enesta Jones declined to offer specifics except to say the agency is on track to meet a June 2 deadline. Last year President Barack Obama outlined a Climate Action Plan that included cutting carbon emissions blamed for climate change.

Nearly 70 percent of electricity in Ohio is produced using coal and almost 16 percent comes from natural gas, another carbon-producing fossil fuel, according to the Ohio Public Utilities Commission. Nuclear power produces nearly 12 percent and petroleum about 1 percent. Renewable and advanced energy sources make up almost 1.6 percent and hydroelectric less than 0.4 percent.

The Natural Resources Defense Council on Thursday held a teleconference to support new regulations for carbon emissions and to say the rules will create jobs and cut electric bills.

The environmental group released a study of the energy-efficiency benefits of its proposed carbon standards, which if fully implemented by 2020 would save American households and businesses $37.4 billion on electric bills that year and create more than 274,000 energy efficiency-related jobs. The report said 8,600 of those jobs would be in Ohio, whose consumers would save nearly $1 billion on electric bills in 2020.

Those numbers do not include any job gains from increasing use of renewable energy sources such as solar or wind, nor are they offset by job losses opponents of the regulations say will occur.

“These rules threaten to suppress average annual U.S. Gross Domestic Product (GDP) by $51 billion and lead to an average of 224,000 fewer U.S. jobs every year through 2030, relative to baseline economic forecasts,” according to a new report by The U.S. Chamber of Commerce’s Institute for 21st Century Energy.

Controversy also surrounds Ohio’s renewable energy and energy efficiency benchmarks, which were approved in 2008. Those would require that by 2025 utilities buy 12.5 percent of energy from renewable sources and reduce energy usage by 22 percent.

The Ohio Legislature this week agreed to freeze the mandates for two years and set up a study group with an eye toward eventually reducing mandates. Ohio Gov. John Kasich will sign the bill, said spokesman Rob Nichols. The bill divided business groups. Proponents said the standards would cost jobs and lead to higher bills for consumers, while opponents said the freeze would cost jobs and cut into savings consumers have seen from the energy efficiency standards.

Environmentalists and renewable energy business leaders say the bill runs counter to the nation’s move away from fossil fuels and toward more regulation to combat climate change and pollution. Earlier this year the U.S. Supreme Court upheld federal anti-smog rules.

Carbon standards will “change the calculus in Ohio,” said Daniel Lashof, NRDC senior fellow. He said it likely will be more costly for Ohio to comply with the new rules because the bill stalls progress Ohio has made in reducing energy consumption and boosting renewables. Consumers will be the losers, Lashof said.

But Nichols said Ohio’s energy climate has changed dramatically with the discovery of shale oil and natural gas reserves in the last few years and it makes sense to review the mandates. Kasich threatened to veto an earlier proposed repeal of the 2008 law.

“Ohio needs more renewable and alternative energy sources and it needs a strong system to support them as they get started,” Nichols said. “It’s naive, however, to think that government could create that system perfectly the first time and never have to check back to see if everything’s ok.”

It likely will be years before carbon standards that the EPA releases fully take effect but utilities and industrial users are already working to meet other rules, such as those governing cooling plant water usage and boiler regulations that effect air emissions, said Sam Randazzo, of McNees Wallace & Nurick, who represents the trade group, Industrial Energy Users-Ohio. He said a number of older coal fired utilities are already being retired and industry officials hope that those retirements and other compliance efforts will be counted in measuring Ohio’s carbon reduction efforts..

Dayton Power & Light spokeswoman Mary Ann Kabel said the company couldn’t comment prior to reviewing the rules but noted that “DP&L complies with all EPA requirements for our generation facilities.”

Columbus-based American Electric Power, which operates in 11 states, has the largest fleet of coal-fueled power plants. Spokeswoman Melissa A. McHenry said the utility company is looking for a “balanced and reasonable regulatory framework” from the feds.

“The regulations should not force the premature shutdown of existing, well-controlled coal-fueled power plants and should recognize the significant CO2 reductions that have already occurred or will occur due to other EPA regulations that will close a significant portion of the coal-fueled generation fleet in the next 14 months,” McHenry said.

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