A repeal of the U.S. Environmental Protection Agency’s (EPA) Clean Power Plan (CPP), as was recently proposed, would not affect the electric transmission and generation plans of such companies as Idaho Power and FirstEnergy (NYSE:FE), company officials told TransmissionHub.
EPA Administrator Scott Pruitt on Oct. 10 issued a notice of proposed rulemaking, proposing to repeal the CPP, according to an EPA statement.
EPA said that after reviewing the CPP, it “has proposed to determine that the Obama-era regulation exceeds the agency’s statutory authority. Repealing the CPP will also facilitate the development of U.S. energy resources and reduce unnecessary regulatory burdens associated with the development of those resources, in keeping with the principles established in President Trump’s Executive Order on Energy Independence.”
Pruitt said in the statement: “EPA will respect the limits of statutory authority. The CPP ignored states’ concerns and eroded longstanding and important partnerships that are a necessary part of achieving positive environmental outcomes. We can now assess whether further regulatory action is warranted; and, if so, what is the most appropriate path forward, consistent with the Clean Air Act and principles of cooperative federalism.”
An Idaho Power spokesperson on Oct. 12 told TransmissionHub that the company is working on two large 500-kV projects that were initiated prior to the CPP, adding, “The plan did not have an impact on the need for those projects, and they remain in progress.”
Two 500-kV projects that Idaho Power is working on, according to its website, are the Boardman to Hemingway Transmission Line Project and the Gateway West Transmission Line Project.
According to the Boardman to Hemingway project website, PacifiCorp, Bonneville Power Administration (BPA), and Idaho Power have jointly proposed to design, build, operate, and maintain the new single-circuit electric transmission line from a proposed substation near Boardman, Ore., to the Hemingway substation near Melba, Idaho.
According to the Gateway West project website, that project is jointly proposed by Idaho Power and Rocky Mountain Power to build and operate about 1,000 miles of new high-voltage transmission lines between the Windstar substation near Glenrock, Wyo., and the Hemingway substation. The project would include about 150 miles of 230-kV lines in Wyoming and about 850 miles of 500-kV lines in Wyoming and Idaho, the site noted.
The spokesperson noted that Idaho Power evaluates its resource adequacy every two years as part of its Integrated Resource Plan (IRP), which identifies the resources needed to reliably serve the growing demand for energy in Idaho Power’s service area over the next 20 years. Idaho Power’s selected resource portfolio is designed to balance cost, risk and environmental concerns, he said.
“The Clean Power Plan’s impact to Idaho Power was minimal due to our already low-carbon generation profile,” the spokesperson said. “That generation relies on 17 hydropower plants in addition to natural gas and power purchased from renewable-energy generators.”
He continued, “As a result, the Clean Power Plan was not the primary driver in the resource decisions Idaho Power outlined in its 2017 IRP. In that plan, we anticipate the early retirement of some coal-fired units. Those decisions were founded on economic considerations, primarily the low cost of natural gas and the capital costs required to operate and maintain the coal units. We don’t anticipate that repealing the Clean Power Plan will alter the economics behind those decisions.”
In a statement provided to TransmissionHub on Oct. 11, Frank Prager, vice president, policy and federal affairs for Xcel Energy (NYSE:XEL), said: “We are continuing to move forward with our clean energy plans regardless of the EPA’s approach to carbon regulation. Our primary focus, as always, is on the states we serve and working with them to achieve our clean energy objectives. It’s an approach we’ve demonstrated is the best path to significantly reduce carbon emissions and transform the power grid while maintaining reliable, low-cost energy for customers.”
A Duke Energy (NYSE:DUK) spokesperson on Oct. 11 said that the company believes that a balanced portfolio of energy resources is important to providing reliable electricity at affordable rates.
“We plan our system and our investments over decades to meet the needs of our customers,” she said, adding that Duke is planning to invest $25bn in grid modernization and $11bn in cleaner generation over the next 10 years.
“Our focus is on building a smarter energy future for our customers, and we remain committed to the investments we’ve planned,” she said. “Because the Supreme Court had halted implementation of the Clean Power Plan, the proposed rescinding of the rule has no immediate impact on Duke Energy.”
In a statement provided to TransmissionHub, Louis Renjel, Duke Energy’s vice president of federal government affairs and strategic policy, said: "The Clean Power Plan as finalized raised significant legal and implementation questions. We appreciate EPA taking these challenges into account as the agency begins the public process of considering a replacement rule. As we have long said, clarity and certainty around the rules are critically important as we make investments to ensure continued safety, reliability and affordability for our customers. We will continue to work constructively with policymakers to achieve that."
A FirstEnergy (NYSE:FE) spokesperson on Oct. 11 told TransmissionHub that the company is not in a position to speculate about potential impacts of EPA’s action on renewables resources or transmission.
“With respect to our generation business, a repeal of the Clean Power Plan does not change FirstEnergy’s decision to exit competitive generation, which is based on challenges of operating in a competitive market,” the spokesperson said, adding that the company will continue with the strategic review of its competitive generating plants, and will complete that process by mid-2018.
While FirstEnergy has made significant environmental investments over the years, power plants had not yet made any new upgrades as a result of the CPP, as that regulation was not yet in effect due to legal challenges, the spokesperson noted, adding that prior to the legal challenges, power plants were awaiting direction from individual states on what would be required of their facilities.
The spokesperson said that FirstEnergy has made substantial progress toward a cleaner generating fleet by investing more than $10bn to enhance environmental performance since the Clean Air Act became law in 1970. She added that the company has already reduced its greenhouse gas emissions more than 40% below 2005 levels, and it expects CO2 emissions will continue to decline.
FirstEnergy is reviewing EPA’s action and looks forward to learning more as the regulatory process continues, the spokesperson said.
In a statement provided to TransmissionHub on Oct. 11, American Transmission Co., (ATC), said: “Since the Clean Power Plan was not fully enacted, its potential repeal does not impact ATC. Therefore, we do not maintain a position on this matter.”
Clarke Bruno – who oversees Anbaric’s legal affairs and projects in the Mid-Atlantic region, as well as projects in Canada – on Oct. 11 told TransmissionHub that the proposed repeal of the CPP “has no effect” on the company’s plans for electric transmission development.
“We understood that this was in the works when the election occurred and expected it,” he said. “Though regrettable it’s not a surprise. We continue to develop projects to meet states’ [renewable portfolio standard, or] RPS goals.”
On whether repealing the CPP will facilitate the development of U.S. energy resources and reduce unnecessary regulatory burdens, as the EPA claimed, Bruno said: “I am skeptical about the prospects of repealing the CPP. It was based on sound science and the courts will likely view efforts to roll it back as arbitrary.”
In a statement provided to TransmissionHub on Oct. 12, Entergy (NYSE:ETR) said that it remains focused on its long-term plans, which include enhancing its generation assets and working closely with its regulators to improve reliability and efficiency.
Noting that it “has been a proactive leader in responsible energy efficiency and generation for more than 15 years,” Entergy said, “We have taken steps to remain under our voluntary carbon cap, by investing in a diversified portfolio of utility-scale solar investments, low-emitting modern natural gas units, and zero-emissions nuclear assets, and we will continue to do so as a long-term commitment of our company.”
A New York Power Authority (NYPA) spokesperson on Oct. 12 told TransmissionHub, “[T]here will be no impact to NYPA’s transmission or renewable energy development plans if the Clean Power Plan is repealed.”
He also said, “New York has embarked on modernizing its grid and moving towards a more consumer-oriented energy system providing for more resiliency, affordability and to make it cleaner under Reforming the Energy Vision long before the Clean Power Plan’s enactment.”
The spokesperson noted that New York is in the process of developing up to $1.5bn in investments in renewable energy projects.
New York Gov. Andrew Cuomo in June announced the Clean Climate Careers initiative following the U.S. decision to withdraw from the Paris Accord, according to a June 2 statement. As part of the first phase of that initiative, the state will make an investment of up to $1.5bn in major renewable energy projects, as well as expand energy efficiency and solar installations at public buildings, the statement added.
Also, in September, Cuomo announced that more than 200 proposals were received from large-scale, clean energy project developers in response to two requests for proposals (RFPs). The state expects to invest up to $1.5bn in new clean energy projects through the two RFPs, administered by NYPA and the New York State Energy Research and Development Authority, the Sept. 25 statement added.
In an Oct. 10 statement on the proposed repeal of the CPP, Cuomo said: “The Trump Administration’s move to dismantle the Clean Power Plan is a reckless decision that gives power plant operators free reign to do what they will without any concern for our climate. It rolls back the progress we have made to reduce carbon emissions and puts industry interests ahead of our ability to reduce damaging emissions. Climate change is a profound threat to our planet, and it cannot be wished away by denial.”
He noted that New York is on track to achieve 50% of electricity from renewables by 2030.
The American Public Power Association, however, supports the repeal of the CPP, as noted in a separate Oct. 10 statement.
“We do need a replacement rule that will allow our community-owned, not-for-profit member public power utilities the flexibility to provide reliable, low-cost electricity to more than 49 million Americans, while protecting the environment,” Carolyn Slaughter, director of environmental services with the association, added in the statement.
She continued: “We believe the Environmental Protection Agency exceeded its statutory authority in issuing the Clean Power Plan, which sought to do too much too quickly. The rule would have created economic inefficiency and imposed unfair costs on consumers.”
Slaughter said that a replacement to the CPP must be based upon a “best system of emission reduction” that can be applied within the fence line of an electric generating unit; allow states to make a case-by-case determination for flexible emission limits for certain units; and account for the remaining useful life of an electric generating unit.
An American Electric Power (NYSE:AEP) spokesperson on Oct. 11 told TransmissionHub that the company supports a replacement for the CPP that is consistent with the EPA’s legal authority under the Clean Air Act.
However, AEP is moving to a cleaner energy future, driven by new technologies and the expectations of its customers and shareholders, the spokesperson said.
“We are diversifying our generation mix to include more renewables, and we’re also investing in a smarter, more efficient and more resilient electricity grid to support these new resources and technologies,” she said. “That strategy is not changing with repeal of the Clean Power Plan.”
AEP has factored future carbon regulations into its evaluation of generation resource options for many years, and it continues to do so, the spokesperson said, adding that AEP has cut its CO2 emissions by 44% since 2000, and will reduce emissions further as it continues to transition to cleaner forms of energy.
The spokesperson noted that AEP in July announced plans to invest $4.5bn in the “largest single-site” wind farm in the United States in Oklahoma and a 350-mile, 765-kV transmission line to deliver that clean energy to its customers. Between now and 2030, AEP plans to add about 2,400 MW of solar generation, 4,900 MW of wind generation, and 2,130 MW of natural gas generation to its generating fleet, subject to regulatory approvals, she said.
In addition, AEP is investing $9bn in the transmission grid in the same timeframe to make the bulk power delivery system more resilient and responsive to new resources and technologies, the spokesperson said.
In a statement provided to TransmissionHub on Oct. 11, Quin Shea, Edison Electric Institute vice president, Environment, said: “As EPA moves to repeal the Clean Power Plan, we also encourage the agency to move forward with a replacement rule that provides states with compliance flexibility, and that allows the electric power industry to continue its fleet transition.”
Shea added that as of 2016, the industry’s carbon dioxide emissions have been reduced 25% from 2005 levels, and that trajectory is expected to continue over the long term.
“Electric companies are focused on ensuring that they can continue to provide reliable, affordable, and increasingly clean energy for all customers, and we look forward to working with EPA, states, and other stakeholders throughout this process,” Shea said.
A PJM Interconnection spokesperson on Oct. 12 told TransmissionHub that PJM does not advocate environmental policy.
“We are neutral but stand ready to support policymakers with analysis and information that may help them as they consider policies,” the spokesperson said. “To that end, last September PJM published an analysis of CPP compliance pathways at the request of our states.”