At issue | April 29 column by Vic Staffieri: "Utilities don't need mandates to find new energy sources."
In his essay, E.On CEO Vic Staffieri deserves credit for acknowledging the scientifically proven reality of climate change.
And though his message was misleading and self-serving, we agree that the "political and social climate change" developing over atmospheric climate change "could dramatically affect the life of every Kentuckian." However, Staffieri's analysis omitted "inconvenient" facts:
The Clean Air Act mandates reductions in pollutants that threaten public health. Accordingly, the U.S. Environmental Protection Agency announced its decision to regulate greenhouse gas (GHG) pollution.
Later this year, within UN-sponsored negotiations, the U.S. is expected to commit to an international treaty, including substantial GHG reductions. These inevitabilities mean burning coal will cost more, especially if Congress adopts a market-based "cap and trade" approach to cutting GHGs.
As Staffieri noted, Kentucky is currently more than 90 percent dependent on coal, the dirtiest source of electricity. Kentuckians will indeed pay disproportionately — unless we seize the many proven opportunities for cutting demand.
Energy efficiency is the cheapest, fastest and cleanest available source of energy. Few would fail to repair a window if a baseball were to knock it out. Yet the gaps in the walls and attics of most homes, offices, stores and schools total a few square feet or more. Most walls and many attics lack adequate insulation. Most of our major appliances waste energy.
Kentucky has dozens of dams that don't generate electricity. E.On is currently upgrading its Falls of the Ohio hydroelectric plant, but why not also add turbines to its two empty bays? Kentucky receives more sunshine than does Germany — now the world's solar energy leader. If German-owned E.On embraces solar energy there, why not here?
Staffieri's claims that renewables are "considerably more expensive" contradict LG&E's testimony before the Public Service Commission, that installing hydroelectric plants at three existing dams on the Ohio River would cost only slightly more than expanding its coal-fired Trimble plant — without cap-and-trade costs.
Kentucky's utilities receive tax credits for building coal-fired power plants, and for every pound of coal burned. Utilities skip out on most of the health and environmental costs of burning coal. If those subsidies were eliminated and a cap and trade system added, renewables would be more than cost competitive.
Each year, public agencies and private charities spend millions on emergency heating programs and still unpaid bills are passed onto the customers as a whole. We'd rather spend that money on creating green jobs, improving energy efficiency and tapping renewable energy.
In a cap and trade system, the government would set the maximum tons of GHGs that could be emitted annually from all power plants, and then issue an allowance for each ton currently emitted by power plants. Over time, the cap would decline, forcing emission reductions. Utilities that could reduce emissions at less cost than others could sell extra allowances to utilities otherwise facing higher costs.
Staffieri warns that fighting climate change would greatly increase utility bills. But history shows that utilities have always exaggerated the costs of new environmental rules. E.On stands to lose only if it resists evolving.
Staffieri would have us wait for his theoretical "solutions" that he admits are "years away," rather than tapping our proven options for E2 and renewable energy. We call upon E.On, to stop clinging to the past, and truly lead in solving the climate crisis. Time is short.