Costly power plan no longer threatens Colorado’s economy

Stan Dempsey/For Craig Press
Stan Dempsey
Courtesy photo

Scott Pruitt, administrator of the Environmental Protection Agency, just did a big — though little-known — favor for states like ours that use coal to generate electricity.His decision to repeal the Clean Power Plan lifted a massive regulation from our state’s economy, sparing our industries and households from the effects of a weakened power grid, higher power prices and lost jobs.

The Clean Power Plan is a prime example of good intentions gone awry. The idea, hatched in the Obama administration, was to reduce carbon dioxide emissions that contribute to global warming. But the solution was to force into retirement many of the power plants that supply more than 55 percent of our state’s electricity — and without delivering any significant environment benefits.

This is one early retirement plan that wouldn’t work for Colorado. That’s because fewer coal plants mean less reliable electricity. Together with the struggles of nuclear power, the result would have made our electric grid precariously dependent on natural gas-fired plants and intermittent energy sources, such as wind and solar, to provide affordable, round-the-clock electricity.

Earlier regulations have already shut down enough power plants nationwide to supply electricity to 40 million homes. The CPP would have shuttered many more. Altogether, about one-fourth of the entire coal fleet would have closed by 2020, with the great majority of these plants forced off the grid by regulations. That would leave coal-state power grids close to threadbare and more vulnerable to storms and outages. Granted, these are low-probability events, but they are high-impact events, too. Ships seldom sink and planes rarely crash, but when they do, our concern is with the impact, not the probability.

The CPP was based on wishful thinking about the ability of renewable power to fill the gap left by coal plant closings. Despite the growth in wind and solar energy, they still supply only 18 percent of Colorado’s electricity. And, even when the sun is shining and the wind is blowing, it’s not always possible to carry renewable power from sunny and windy regions to parts of the country where it’s needed.

Worse, the CPP would have raised electricity costs. The Supreme Court stayed the regulation, faulting former President Barack Obama’s regulators for ignoring cost impacts. Estimates vary, but some economists concluded that constructing new infrastructure to replace the retired coal plants would cost $64 billion. And that would have come on top of rising wholesale electricity costs that utilities would eventually pass on to consumers. The decline of coal-based power plants would lead to further declines in coal production, contributing to as many as 225,000 lost jobs — from the mines and plants to the railroads, barges and ports. The loss of these high-wage jobs would have been especially damaging in coal-dependent states like ours, where almost 13,000 jobs rely on coal.

Environmental activists will hammer Pruitt for rolling back climate change action. But the most surprising fact about the CPP is how trivial its environmental benefit would have been: a reduction of 0.018-degree Celsius. The CPP would have had a much bigger impact on the economy than it ever would have on climate change.

The Department of Energy is trying to forestall further weakening of the nation’s power grid. Energy Secretary Rick Perry has asked federal regulators to assign higher values to coal and nuclear power plants in recognition of their reliability. That should help reduce further closures of power plants that can quickly and constantly generate power when needed.

Activists now claim the recent hurricanes that wracked our shores show the effect of climate change. But these storms also dramatize the vulnerability of our power grids. Improving the environment is a worthy goal; let’s do it without making grid reliability worse.

Stan Dempsey is president of the Colorado Mining Association.

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