Obama Seeks Emissions Limits to Revive Climate Proposal

Tuesday, 25 Jun 2013 10:57 AM

 

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President Barack Obama will attempt a revival of U.S. efforts to tackle climate change today by announcing a sweeping plan that would impose limits on greenhouse gas emissions from all U.S. power plants.

The mandatory reductions by operators of power plants, the biggest single source of carbon-dioxide emissions in the U.S., are the centerpiece of Obama’s initiative, which also includes increasing energy efficiency and promoting renewable fuels, according to senior administration officials who briefed reporters on the proposal and asked not to be identified before it was formally released.

The officials wouldn’t put a price on the package, which they said can be accomplished without congressional approval. Obama is scheduled to unveil it about 2 p.m. local time at Georgetown University in Washington.

Absent from Obama’s plan is a decision on the future of TransCanada Corp.’s Keystone XL pipeline, which would carry crude from oil sands in Alberta to refineries along the Gulf of Mexico. Environmental activists have made the $5.3 billion project a litmus test for the president, saying the measures he’s announcing today won’t offset the political and ecological damage of building the pipeline. The Keystone issue will be decided later this year.

Obama pledged more than three years ago to cut U.S. carbon- dioxide emissions 17 percent below 2005 levels by the end of the decade. While he’s highlighted the threat of global warming in high-profile speeches at home and abroad, Obama hasn’t detailed how he intends to address it.

‘Global Threat’

“This is the global threat of our time,” Obama said in Berlin on June 19. “For the sake of future generations, our generation must move toward a global compact to confront a changing climate before it is too late.”

By focusing on power plants, Obama’s administration is confronting one of the largest contributors to greenhouse gas emissions. Forty percent of U.S. carbon dioxide emissions and one-third of all greenhouse gases, come from electric power plants, according to the U.S. Energy Information Administration.

Actual reductions under Obama’s plan are unlikely to begin until 2018, given the amount of government and legal review required, according to Kevin Kennedy, director of the climate initiative at the World Resources Institute

“There really is a need to be able to move ahead with a regime of solutions throughout the economy,” said Kennedy. “But starting now with power plants is going to be a big first step.”

Carbon Capture

The president’s plan also includes $8 billion in new loan guarantees for carbon capture projects, as well as proposals to promote renewable energy development on federal lands, the construction of more climate-resilient infrastructure, and energy efficiency standards for appliances and federal buildings.

He also will call for ending U.S. government financing of coal plants overseas, except for those that use carbon capture and sequestration technologies or are in the poorest nations.

As the administration has rolled out pieces of the plan, companies and industry groups are raising objections.

Utilities such as Southern Co. and American Electric Power Co. and coal producers including Peabody Energy Corp. argue that limiting coal use will raise consumer energy costs.

“Taking America’s most significant source of electricity offline would have disastrous consequences for our nation’s economy,” Mike Duncan, the president of the American Coalition for Clean Coal Electricity, said in a statement.

Coal Plants

There are about 6,597 power plants in the U.S., 589 of which are coal-fired, according to the Energy Information Administration. Last year, coal plants accounted for 38 percent of electricity produced in the U.S., followed by natural gas and nuclear power which produced 29 percent and 20 percent, respectively.

Four top congressional leaders, including Senator Mitch McConnell, Republican of Kentucky, are scheduled to meet with Obama at the White House later today. McConnell, who represents the nation’s largest coal-production state after Wyoming and West Virginia, said he’ll tell Obama that the emissions plan would hurt jobs.

“Declaring a ‘War on Coal’ is tantamount to declaring a ‘War on Jobs,’” McConnell said in a statement. “It’s tantamount to kicking the ladder out from beneath the feet of many Americans struggling in today’s economy.”

Seeking Balance

Obama will argue that Americans don’t have to choose between economic growth and cutting carbon pollution by pointing to jobs that will be created through development and use of renewable and more efficient energy technology, according to the administration officials.

“There’s going to natural hesitation and risk avoidance voices, but in every case there is a better outcome,” said Admiral Dennis McGinn, president of the American Council on Renewable Energy. “This is really a great time to think of this not only in terms of cost but to think of this in terms of investment.”

The administration’s message is helped by a recent change in the government’s calculation of the social cost of carbon emissions, a measure that’s used to determine the costs and benefits of climate rules. The U.S. government now assumes it is worth about $36 per ton to avoid emitting carbon, an increase from the $22 per ton price previously used.

“The EPA could generate a rule that is 60 percent more expensive then it would have been prior to the change in the social cost models and still claim that it is cost beneficial,” said Scott Segal, a lobbyist for coal-fired utility companies. “That’s the kind of back of the envelope accounting that would make Enron smile.”

Rules for new power plants proposed by the EPA, under authority granted by the Clean Air Act, have been indefinitely delayed. Obama plans to put new deadlines on the agency, setting a deadline of Sept. 20 for new power plants and the release of a proposal for existing plants by June 2014.


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