Last week, President Obama announced that he’s directing the Environmental Protection Agency to crack down on air pollution from coal-powered utility plants. As part of a more aggressive stance on climate change, federal regulators will now write carbon emission standards for existing plants as well as any built in the future. Some in the coal industry squealed but utility companies, generally, were more muted in their reaction. There are reasons for that, as ideastream’s Brian Bull explains.
There are more than 100 coal-fired power plants in Ohio, and they generate 80 percent of the state’s electrical power.
The plentiful supply of coal is a part of what’s kept electricity prices below the national average here for at least the last 15 years.
On the flip side, Ohio’s heavy dependence on coal power has helped it earn 4th place in the rankings of carbon dioxide emitting states.
So, in Ohio there’s a lot at stake in the new path Washington is taking to reduce those C02 emissions.
Coal producers see a gloomy future.
“It’s gonna hurt the United States, because it will drive up our electric costs. Our manufacturing will not be competitive," says Chuck Ungarean. He's president of Oxford Resources, which runs 17 coal mines in Ohio.
“The price of electricity will definitely go up 30, 40, 50 percent, and that’s just a wild guess.”
Just how much the price of electricity will fluctuate will depend on new expenditures power plants that continue to emit carbon would have to pay… something the President alluded to last week.
What hits closest to home for coal companies and miners though is jobs.
3,000 people work in coal production in Ohio. And those jobs are at risk if power companies switch from coal to other power sources.
That’s already happening and has been for a while.
Ohio University’s Mike Zimmer is a specialist on energy, economics and the environment .
“The coal market is shifting," says Zimmer. "Coal jobs in Ohio have been declining the past 10 years. Electric utilities themselves have already starting to switch and use natural gas rather than coal, two to three years ago.”
Power companies have been retrofitting some coal plants with technology that allows them to burn cleaner.
And they’ve been phasing out older plants.
American Electric Power produces 60 percent of its power from coal now.
“We already have a plan that will bring that number below 50 percent by 2020," says Melanie McHenry, a spokeswoman for American Electric Power. She adds part of that transition includes more reliance on natural gas.
Republicans have accused the Obama Administration of waging “a war on coal.” But some observers say coal’s decline and its uncertain future is more a matter of market forces.
“In a sense, natural gas has a `war on coal’ right now," says Andrew Kear, a political science professor at Bowling Green State University. "Natural gas is replacing a lot of coal-burning power plants throughout the United States. A lot of it is related to price.”
Natural gas is cheaper and cleaner than coal.
First Energy, another big Ohio utility says natural gas is a key part of its strategy in reducing greenhouse gases and says it’s already ahead of schedule in meeting current emissions standards.
So, when the President announced that broader, more stringent regulation is coming, utilities here took a cautious -- but not necessarily critical -- tone.
“You know, any new regulations do have the potential to have impacts on prices and jobs," says First Energy’s Stephanie Thornton. "But we’ll have to continue to evaluate what those may be in the coming months.”
Last week, President Obama directed the EPA to draft carbon pollution standards for existing power plants by June of 2014…with final regulations a year after that.
The agency is to issue new standards for future plants within three months.
Power companies say they need standards that are technically achievable.
And they want certainty about emission standards – “a stable horizon” as one utility put it. They say that would allow them to plan for more decisive investment in greener energy sources.