Tamar Hallerman
GHG Monitor
3/8/13
A House Energy and Commerce subcommittee hearing this week indicated that some lawmakers continue to be on entirely different pages regarding the future of coal in the U.S. In one of the first energy hearings of the new Congress, the Energy and Power Subcommittee focused on the need for a diverse electricity generation mix, with many Republicans on the panel lamenting coal-to-gas fuel switching due to recent Environmental Protection Agency regulations and cheap gas prices. Subcommittee Chair Ed Whitfield (R-Ky.), whose district includes portions of southwest Kentucky that have significant coal capacity, specifically blamed federal agencies and interest groups that he says are methodically trying to weed out coal from the country’s electricity generation mix. “It’s important to be realistic. We know there are people in the Administration, political leaders around the country and national and international environmental groups who really do have a desire to stop the use of fossil fuel in the production of electricity,” Whitfield said.
Whitfield referenced remarks made by New York City Mayor Michael Bloomberg last week, in which the billionaire said at a Department of Energy-sponsored conference that “king coal” is a “dead man walking.” “Coal is being taken out of the national fuel mix and EPA is methodically establishing a regulatory framework to dramatically reduce fossil fuel use throughout of the economy,” Whitfield added. “I believe that will lead to serious problems in America.” Rep. Steve Scalise (R-La.) said EPA is picking energy winners and losers and that “ultimately, the losers are the families who are paying higher electricity bills.” American Electric Power Executive Vice President for Generation Mark McCollough said in his testimony that federal regulations limiting the construction of new coal units such as EPA’s proposed New Source Performance Standards will limit flexibility in the electricity generating mix and eliminate fuel diversity by leading to an overreliance on natural gas. “Federal policy should support fuel diversity, not preclude it,” he said. AEP has switched much of its capacity to gas in recent years as it has been forced to shutter much of its aging coal fleet—one of the country’s largest—due to other EPA regulations and cheap gas prices.
Waxman Cites Need to Address Climate Change
Meanwhile, Democrats on the subcommittee criticized the Republicans for focusing too heavily on coal and other fossil fuels and failing to adequately consider alternatives. “In this committee, we like to pretend that there’s no connection between how we generate our energy and climate change,” Energy and Commerce Committee Ranking Member Henry Waxman (D-Calif.) said. “The fact is that climate change is the biggest energy challenge we face as a country and we can’t have a conversation about American energy policy without also having a conversation about climate change.” Waxman and Sen. Sheldon Whitehouse (D-R.I.) recently launched a Congressional task force on climate change that seeks to identify ways the Administration can move to limit the effects of global warming even without Congressional action.
Waxman asked the heads of three major U.S. utilities testifying at the hearing whether they would prefer Congress to enact climate legislation or for the Obama Administration to continue its regulations of greenhouse gases under the authority of the Clean Air Act. Officials from AEP, Entergy and Xcel Energy all said they would prefer the former. “We do support a legislative approach over a regulatory approach, and depending on the details we would be very interested,” AEP’s McCollough said. Entergy Wholesale Commodities President William Mohl agreed. “We support some type of market-based price signal [like] a price on carbon emissions. We believe that makes a lot of sense and that it’s better than a command-and-control structure because it provides the incentive to develop new and cleaner technologies,” he said.
Waxman cited the International Energy Agency’s 2011 World Energy Outlook, which warned that all of the world’s energy sources for 2035 will become “locked-in” by 2017 given the nature of typical contracts for power plants. “The energy policy decisions that we make today will have a real and direct impact on whether we can prevent the worst impacts of climate change in the future. Every decision to build a new fossil fuel-fired plant poses a climate risk,” he said. “We need to understand and weigh those risks. Otherwise, we’re going to be locking in an infrastructure that produces carbon pollution for decades to come or creating stranded investments that must be shut down before they have served a useful life.”
