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The brakes have been applied to the construction of new coal plants in the United States following a permit denial last week by the Environmental Protection Agency’s (EPA) top rulemaking panel. The EPA’s Environmental Appeals Board ruled Thursday that the EPA had no valid reason for failing to place limits on the global warming emissions from Desert Power’s proposed 110-megawatt coal-fired power plant in Vernal, UT. Deseret’s Bonanza Generating Station, which would have emitted 3.37 million tons of carbon dioxide each year, is one of about 100 proposed coal plants that may now be required to limit their greenhouse gas emissions. “The carbon-intensive fossil fuel provides nearly half of the United States’ electricity, and is responsible for some 30% of the country’s greenhouse gas emissions,” wrote Time magazine. If the proposed plants are built “without the means to capture and sequester underground the carbon they emit — and it’s far from clear that such technology will be commercially viable in the near-term – our ambitious goals to reduce greenhouse gas emissions and avert climate change will be meaningless.”
‘BACK TO SQUARE ONE’: In July 2007, the EPA issued a permit for the Bonanza plant, ignoring the Clean Air Act’s stipulation that new plants must include a “best-available control technology” emissions limit for each pollutant “subject to regulation under the Act.” Three months earlier, the Supreme Court had ruled that carbon dioxide is a global warming pollutant and mandated the EPA to take action. Before the Sierra Club brought suit against the Bonanza permit for ignoring the Supreme Court decision, Rep. Henry Waxman (D-CA), chair of the House Committee on Oversight and Government Reform opened an investigation, saying, “The Administration’s shameful decision rewards polluters, flouts the Clean Air Act, and fails the American people.” Corporate trade groups who joined the Bush administration in arguing the permit should be upheld included the American Petroleum Institute, U.S. Chamber of Commerce, the American Chemistry Council and the National Association of Manufacturers. The Environmental Appeals Board instead found for the plaintiffs, describing the Bush administration’s arguments in a 69-page decision as “weak,” “questionable,” “not sustainable,” and “not sufficient.” The decision rebuked the EPA for failing to issue CO2 regulations, repeatedly recommending an “action of nationwide scope.” The EPA board is “sending this permit — and effectively sending every other permit — back to square one,” said David Bookbinder, chief climate counsel for the Sierra Club. He added, “It’s minimum a one- to two-year delay for every proposed coal-fired power plant in the United States.”
RISKS OF COAL: Coal is the dominant fuel for electricity generation in the United States because of its historically low cost for producers, but that is only because the real price of its pollution is not considered. The particulate matter, smog, and acid rain from burning coal cause billions of dollars in additional health costs a year. As Sen. Harry Reid (D-NV) said this summer, “Coal makes us sick.” Combined with the environmental degradation of mining coal and the planetary risks of climate change from coal’s carbon dioxide emissions, the “market externalities” of coal-fired electricity — the costs paid by society, not the producers — mean that the true cost of coal is immense. In October, Dynegy, a major owner of coal-burning power plants, “agreed to put detailed information in its financial filings on any material business risks posed by climate change.” Innovest Strategic Value Advisors has warned investors and ratepayers of the financial risks of proposed unregulated coal-fired plants in Kansas, Colorado, and Nevada. Following the EPA board decision, coal stocks took a material hit on Friday: Peabody Energy declined 8 percent, and Massey Energy and Arch Coal plunged 12 percent. “The single most important thing we could do is to put a price on the CO2 in our economy today,” argued Al Gore in September. “Tax what we burn, not what we earn.”
NO NEW COAL: Leading climate scientists and activists, from James Hansen to Al Gore, have called for an immediate moratorium on the construction of new coal plants. This past weekend, thousands of youth activists took part in protests against the financing of new coal-fired plants. In September, the Arkansas Commission on Global Warming adopted a recommendation that “no new coal plants be built in Arkansas” until carbon sequestration technology is ready. The Center for American Progress recommends that comprehensive climate change legislation include an emission performance standard for new coal plants which would require these plants to capture and store their CO2 emissions, with a crash course to develop the new technology. Investments in new coal technology are needed to mitigate its risks, but they will not be major job creators. Most of the dollars invested in coal go to capital-intensive efforts such as mining and plant construction that generate few jobs. In contrast, the “green economy” — based on retrofitting buildings, mass transit, energy-efficient automobiles, wind power, solar power, and cellulosic biomass fuels — creates many more jobs. Joanna Spalding, the Sierra Club attorney who successfully argued the case, remarked, “This decision gives the Obama Administration a clean slate to begin building our clean energy economy for the 21st century.”
