impact of new power plant rules

William "Billy" Ray: EPA plan an opportunity for innovation, better health and new jobs

June 11, 2014 

The Environmental Protection Agency's announcement of new restrictions on greenhouse-gas emissions from power plants has already caused everyone to choose a side and dig in for a battle that no one really understands. In case there are any Kentuckians who have not chosen a side, I offer some thoughts, from a utility insider, on how the new regulations might impact us all.

Most of Kentucky's congressional delegation (and those who are presently trying to enter that delegation) is 100 percent committed to opposing the new regulations.

Since these sides and positions were chosen so quickly, one must infer that this is done to gain the favor of an industry that often gives big dollars to political campaigns — the coal industry. The positions already taken by our legislators can have nothing to do with making the lot of us Kentuckians better, because they have not had the time necessary to totally understand the impact of the new regulations.

I suggest that there is a middle ground.

There is already great opposition to the new regulations, mainly because we have been told that electric power rates will soar. Even if that were true, Kentuckians must also take into account the nagging issue that burning coal causes a warehouse full of health and climate issues, most of which — if properly monetized in the same recognizable form as our monthly power bill — would dwarf the impact of higher electric bills.

There are folks who have earned the right to warn us about climate change, and one must be consciously drowning them out not to hear, and recognize, that we probably are slowly destroying everything we love with each kWh produced by burning fossil fuel. We must make progress on that problem, and the jobs which may be lost as coal consumption declines.

Just how might our electric bills change under this new regulatory environment? The answer depends on how you ask the question.

If the electric power industry and its customers continue to do things the way we have, electric bills will be staggering. But in the real world, we ought to expect that new economics would bring about new solutions, new ideas, and an evolution of thinking about how electric power should be supplied to our communities.

Automakers responded to evolving fuel costs and pollution regulations by producing cleaner and more efficient cars and trucks. Surely the electric power industry can do as well as they have done. In 2014 and beyond, we should be able to design electric power solutions that are yearning to become viable, needing only a little change to the status quo to flourish. These new solutions should also bring new businesses and jobs.

In Glasgow, we have been changing our relationship with our electric customers over the last couple of years. We are attempting to predict when Glasgow's peak demand might occur and we are telling the community, and our customers are responding by showing that electric demand can be reshaped such that only the most clean and efficient generation needs to be used to meet our daily demands.

Coming soon will be a totally new retail rate structure that will amplify those peak predictions and assign costs to customers based upon the time of day when they use energy. These are solutions that are designed to work with more stringent regulations on Tennessee Valley Authority and other utilities, and help them accomplish the goals of these new regulations.

So, there are ways to move ahead and utilize cleaner electric power generation resources. There are solutions that will allow us to enjoy life and electric power, while we also turn back the clock on the impact we are having on our air, water and climate. But these new ideas have not been considered in the Kentucky call to arms that began with the EPA announcement. These ideas are also not considered when we all assume that lost coal jobs will not be replaced.

We are not bound by the way we operated utilities for the last century. We have a chance to use this chaotic time to our advantage. We are ready, at least as ready as any state, to move toward a lasting peace, instead of joining in a war that seems already to be declared.

William J. "Billy" Ray is CEO of the Glasgow Electric Plant Board.

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