US EPA head reassures power sector on emissions rules

The head of the US Environmental Protection Agency (EPA) has said the agency’s forthcoming carbon emission regulations will not disadvantage coal-fired plants.

“Let me be clear about one thing,” Gina McCarthy (pictured) said in a speech last week at the IHS CERAWeek energy industry conference in Houston, Texas. “Conventional fuels like coal and natural gas are going to play a critical role in a diverse energy mix for years to come.

“New power plants powered by conventional fuels do have a pathway forward in a carbon constrained world,” she continued. “We believe there are technologies that, if we continue to invest, will allow fossil fuels to be part of … a clean energy mix.”

The draft rules will be released in June and will undergo a 12-month review before becoming law.  

Legal challenges are expected, and large coal-producing states have already made their reactions felt in Congress. The Republican-controlled House of Representatives passed a bill on Thursday that would limit the EPA’s ability to regulate carbon emissions from power plants, but it is unlikely to pass in the Democrat-controlled Senate and President Obama has said he will veto it.

At stake is the worry that tough emissions rules could shut down many older coal plants, endangering the stability of the US power supply. And the industry is already struggling as cheap natural gas and renewables drive down power prices.

“When it comes to developing carbon pollution standards, no matter what we do there are going to be naysayers that claim we go too far,” McCarthy said. “They'll say … that climate rules will put the brakes on business. We've heard this tired argument again and again before. And every single time, it's fallen flat on its face. It won't be true this time around, either.”

McCarthy used the example of the reinvigorated US auto industry to say the nation doesn’t “have to choose between a healthy environment and a healthy economy”.

Industry players have appealed to the EPA to be gentle with them. Also speaking at CERAWeek, Lynn Good, CEO of Duke Energy, said the new regulations should take note of power sector emissions reductions already in place.

And Nick Akins, CEO of American Electric Power, said, “I am hopeful that there will be some rationalization around, if there is any imposition on existing units, that it is responsive and respectful to the transition that is already being made, and that in order not to impact the economy, impact certainly the reliability of the grid, we need to ensure that this is done in a rational way."

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