Newspaper article The Florida Times Union

JEA Says EPA Pollution Plan Is 'Disruptive'; Utility: Carbon Emissions Reduction by 2030 Is Too Soon and Very Expensive

Newspaper article The Florida Times Union

JEA Says EPA Pollution Plan Is 'Disruptive'; Utility: Carbon Emissions Reduction by 2030 Is Too Soon and Very Expensive

Article excerpt

Byline: Nate Monroe

JEA casts a critical eye toward President Barack Obama's proposal seeking to curb pollution from the nation's power plants, using unusually pointed language to say the regulations would imperil local ratepayers, strip Florida utilities of needed fuel flexibility and have major impacts on the state economy.

Jacksonville's electric utility says the complex Environmental Protection Agency rule, aimed at reducing carbon emissions 30 percent by 2030, is too soon and unnecessarily expensive and that interim goals starting in 2020 are "crazy, unnecessary and unattainable," according to a draft outline of comments JEA is preparing to send to the EPA.

In sum, the utility makes its position clear: The rule is "the most disruptive energy policy proposal in modern times."

JEA says the EPA's aggressive goal would quickly render coal-fired power plants obsolete in favor of cleaner natural gas plants and other renewable sources. Though the industry, as well as JEA, has invested in natural gas for electric generation, coal remains a major fuel source.

With utilities potentially scrambling to comply, ratepayers across Florida would likely pick up the bill.

The state's efforts to coordinate a compliance plan could also put utilities at political odds - pitting private, investor-owned utilities that have been able to more nimbly invest in cleaner technology against public utilities like JEA, which are largely limited to revenue generated by ratepayers.

"You're restricting the way utilities prefer to do business," said Ted Kury, director of energy studies for the University of Florida's Public Utility Research Center. "It's going to raise costs."

JEA has said its compliance costs could top $1 billion.

"Practically eliminating coal as a generation source will result in undue reliance on natural gas in times of supply deficits or disruptions and price spikes," JEA's draft comments say. "It would be impractical and economically irresponsible to mothball coal plants needed to meet such events."

The EPA says the rule is a "commonsense plan" to cut pollution and, because it gives states the discretion to decide how they will meet the goals, solutions can be tailored to the needs and interests of each state.


The debate is taking place amid much uncertainty.

Republicans could retake the U.S. Senate in November and the White House in 2016, recasting the political balance against Obama's plan.

Federal regulators are accepting comments through Oct. 16, which could sway some aspects of the finalized rule. The proposal has also sparked legal challenges - lawsuits are already underway.

Some environmental activists don't think the rule goes far enough, while large segments of the industry echo JEA's concerns.

"If the EPA moves forward with regulations that call for too much change too fast, we will likely see unnecessary coal-plant retirements without long-term plans for viable, cost-effective alternatives; higher electricity prices; and potential shortage of electricity supply," the American Public Power Association, of which JEA is a member, said in a statement on the rule.

Should the proposed rule be finalized, state governments will face their own set of political and industry pressures as they set up compliance plans.

For example, Florida Power & Light, the state's largest utility, already uses far more natural gas and nuclear power for electric generation - those sources generated about 87 percent of FP&L's power in 2013 - than JEA or other Florida utilities.

That means those utilities could face larger costs, and potential rate increases, than the better-positioned FP&L.

In the competitive utility industry, that could rankle. …

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