Duke Energy, DENR critique EPA carbon plan

The Obama administration’s plan to reduce carbon dioxide emissions from power plants would “fundamentally alter how electricity is generated, delivered and consumed in the country,” Duke Energy says.

The plan aims to curb emissions 30 percent by 2030 compared with 2005 levels. It leaves to each state how to reach state-by-state targets, but Duke says the states should play a larger role.

An interim 2020 deadline could force power plants to shut down prematurely, leaving customers to pay billions of dollars in costs, the nation’s biggest electric holding company said in filings to meet Monday’s comment deadline.

A blizzard of papers swirled toward the Environmental Protection Agency. Utilities and states including North Carolina complained of overreach in the plan. Environmental advocates and some businesses praised it as a past-due response to climate change, which is linked to carbon dioxide.

Duke said it supports action to address climate change. But it said the EPA went against previous interpretations of the Clean Air Act in including energy efficiency and renewable energy as ways to reduce emissions.

“What they’ve done is to broaden the meaning of ‘system’ to include the entire electric system, and to include sources that don’t produce power or emissions,” said Diane Denton, Duke’s director of environmental and energy policy. “It would require us to dispatch gas (fuel) ahead of coal, even when it’s more expensive to do that.”

Duke operates in six states – the Carolinas, Florida, Ohio, Indiana and Kentucky – and serves 7.2 million customers.

By comparing future reductions to a baseline year of 2012, Duke said, EPA ignored the company’s carbon-cutting strides before then. Duke says it reduced carbon emissions 20 percent between 2005 and 2013 as it shut down coal-fired power plants and moved to cleaner-burning natural gas.

“We want to make sure our states and customers get credit for that,” Denton said. She had no specific estimates of how Duke’s fleet, or customers, could be affected by the plan.

Gudrun Thompson, a lawyer with the Southern Environmental Law Center, said Duke will still be getting credit for what it’s done since 2012, including coal-plant retirements, natural gas usage, and energy efficiency and renewable energy initiatives.

“The notion that North Carolina is somehow being penalized by transitioning to cleaner energy is not true,” she said.

“Based on our analysis, North Carolina is going to get all the way to EPA’s target, and maybe below that, by 2030 just based on utility plans and commitments that are already in place” and the state’s renewable-energy mandate.

North Carolina’s Department of Environment and Natural Resources also criticized the plan, questioning EPA’s legal authority and use of the Clean Air Act to impose the new carbon limits.

The plan sets North Carolina’s target at a 40 percent reduction in its overall emission rate, a measure of how efficiently power plants operate.

But EPA’s proposal – not expected to become final until 2016 – makes it harder to run an existing coal-fired power plant than to build a new one fueled by natural gas, Duke says.

“There is no legal or rational basis to set North Carolina’s mandatory goals for existing units below the standards for new units,” environment Secretary John Skvarla wrote.

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