State could use cap-and-trade for new EPA emissions rules

Kansas Corporation Commission discusses options

Posted: June 5, 2014 - 4:34pm

Kansas will have some flexibility in meeting new carbon regulations, but some older coal plants could be shuttered, depending on the methods chosen to meet the regulations, Kansas Corporation Commission staff said Thursday morning.

The Environmental Protection Agency proposed regulations Monday to cut carbon dioxide emissions nationwide by 30 percent in 2030. Kansas would be required to reduce its emissions by 23 percent if the rules move forward in their current form. The final rule will be issued in 2015, and states have to turn in their plans by 2016, said Jeff McClanahan, director of the utilities division for the KCC.

McClanahan told the three KCC commissioners Thursday that staff members are still reading over the regulations, which run for hundreds of pages, to determine how they will affect Kansas.

It appears the EPA has set a goal of reducing carbon dioxide emissions by 30 percent compared to their 1995 levels, he said, and gave Kansas credit for already reducing its emissions by 7 percent as of 2012. It isn’t clear how much environmental projects on existing plants or new renewable energy projects installed since 2012 might count for.

The Kansas Department of Health and Environment will lead the response to the EPA rules, McClanahan said, but KCC will work with them. KCC regulates electric utilities in Kansas, as well as the transportation and oil and gas industries. The new rules apply to existing power plants.

It appears the state will have a variety of “building blocks” it can use as options to meet its emissions target, McClanahan said. Those could include making power plants more efficient so they don’t burn as much fuel, increasing efficiency on the customer end so the state doesn’t need to produce as much electicity, switching some coal plants to natural gas, sequestering carbon dioxide underground and running high-emissions plants less often, he said.

Interstate agreements appear to be allowed under the agreement, McClanahan said, so states that have trouble reducing their emissions could buy credits from others that do so more easily. Kansas probably also could set up a system like that within the state for utilities to trade credits if it chose, he said.

The rule doesn’t specify that each plant must reduce its emissions by 23 percent, McClanahan said, so it isn’t clear how they will be affected.

Utilities may decide to shutter small, older coal plants if the cost of retrofitting is too high, he said, but if the Kansas plan doesn’t emphasize retrofitting that may not be necessary.

“There’s going to be a lot of different ways to get there,” he said.

Gina Penzig, spokeswoman for Westar Energy, said the company is still digesting the rule’s implications and is waiting for direction on how the state plans to proceed.

“It’s way too early in the process” to talk about the future of specific plants, she said.

The EPA predicted a 1 to 2 percent rate increase to comply with its regulations, with costs nationwide of $7.3 billion to $8.8 billion. It estimated $55 billion to $93 billion in benefits, mostly from reduced health costs and mitigating the effects of climate change.


Follow Megan on Twitter @meganhartMC.

Comments ( 6 ) sign in or create a profile to comment
Nunyabiz1 06/06/14 - 03:53 am
"It appears the state will

"It appears the state will have a variety of “building blocks” it can use as options to meet its emissions target..."

The main one being "necessarily skyrocketing energy costs", which will raise the rates of everyone, and absolutely EVERY SINGLE PRODUCT bought and sold. This will negatively affect jobs, and hurt the middle class...and...oh, yes..."the poor".

But, "the poor" will be OK. What's left of the struggling middle class private-sector net-positive taxpayers (one of the very few groups who actually pay net-positive taxes) will subsidize their bills...until the struggling middle class taxpayers find ourselves amongst the poor, also, because of spiked energy costs and raised prices.

Thanks, "progressives". You're doing a dandy job of destroying America.

PreachersKid 06/06/14 - 04:50 am
Isn't this one of

the things HE wants? Didn't HE say that energy prices (particularly gasoline as I recall) were too low? Isn't this the kind of thing that was going on about 100 years ago on the other side of the world? How did that turn out? Maybe Vlad can shed some light on it.

Nunyabiz1 06/06/14 - 04:58 am
Well, PK...

To "fundamentally transform", you must first demolish, THEN rebuild.

Obama has been chosen as foreman of the demolition crew, and he is going full-tilt destructo!

jacovdog 06/06/14 - 05:50 am
Cap and Trade? Oh yes. wasn't

Cap and Trade? Oh yes. wasn't that concept rejected by Congress? But, no bad policy is too good for us.

Pkinnett 06/06/14 - 11:17 am
This issue is bigger than price raises.

But Conservatives cannot see the bigger picture. They reject it even when the bigger picture is explained to them so why try? "Progressives" can see the bigger picture and know how to handle the problems. But it takes governmental controls and those puppets of talking heads say NO to governmental controls. Why? Because the talking heads tell them it is bad. They do not follow the money. Who pays the talking heads? Where does the companies who pay the talking heads get their money? Oh it is from business owners who have personal reasons to not have governmental controls. It is called greed.

Nunyabiz1 06/07/14 - 03:20 am

"They do not follow the money."

Why not try following the Dems dirty money trail for once, and learn the rest of the story?

The Dems are at least, if not more. "big-money dirty" than the Republicans. The Dems just lie about it to fool the lemmings.

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