In June 2013, President Barack Obama rolled out his Climate Action Plan to cut carbon pollution in the U.S. and to demonstrate U.S. leadership on international efforts to address climate change. This plan has significant consequences for the coal industry and for West Virginia — in 2012, 16 coal plants generated about 95 percent of electricity in the state.
Tackling climate change means dramatically reducing carbon dioxide emissions in the generation of electricity. Some call the president’s plan a “war on coal.” In reality it is a declared war on climate change, and coal is clearly caught in the crossfire. It is the fuel source responsible for the vast majority of emissions (in the electricity sector) that contribute to climate change. In 2013, coal-fired generation produced 39 percent of the electricity in the U.S. but was responsible for 77 percent of the CO2 emissions in the power industry.
When the Environmental Protection Agency issued a draft Clean Power Plan in June 2014, the West Virginia University Center for Energy and Sustainable Development, which I direct, partnered with Downstream Strategies, an environmental consulting firm in Morgantown, to analyze the proposed rules and develop some possible compliance strategies for West Virginia. The proposed rules called for a 30-percent reduction in CO2 emissions from the electricity sector nationwide by 2030. West Virginia was expected to achieve a 20-percent reduction.
In June, we released a detailed report that illustrates the strategies that West Virginia could follow to achieve the required reductions. Two of the scenarios are “all-of-the-above” approaches that would build upon the state’s coal-fired generation and also incorporate other energy resources.
These resources include co-firing natural gas with coal at existing coal plants, ramping up utility energy-efficiency programs, increasing the use of renewables (solar, wind and small-scale hydro) and reflecting the anticipated addition of new natural gas-fired generation in the northern panhandle. Both scenarios would achieve the required reduction in CO2 emissions, and coal would remain the dominant source of electricity within the state at around 75 percent.
On Aug. 3, the EPA released the final rules under its Clean Power Plan, which included slightly more aggressive targets nationwide — a 32-percent reduction instead of 30 — and much more aggressive reductions for coal-dependent states. West Virginia’s target increased from 20 percent to 37 percent. (This would be a 29-percent reduction if the state chooses to aggregate all the CO2 emissions within the state rather than look at emission rates at individual plants.)
These are very challenging goals for West Virginia and will require an “all-of-the-above” compliance strategy that increases reliance on lower-carbon resources such as natural gas, renewable sources, and energy-efficiency and conservation programs.
The Clean Power Plan is already under challenge in the courts, and coal-dependent states are being encouraged to take a “just say no” approach: states would decline to submit a compliance plan to the EPA. This strategy poses considerable risks given that the Clean Air Act gives the EPA authority to impose a federal plan on noncompliant states. Any federal plan is likely to be more costly and disruptive than plans developed by individual states, which reflect each state’s unique characteristics and capabilities.
As our political leaders grapple with these challenging decisions, they are under tremendous pressure to balance the needs of traditional extraction industries against the opportunities presented by a lower carbon path that would achieve compliance with rules promulgated by an unpopular agency under a president seemingly more interested in international climate change negotiations than acknowledging the devastating impacts on coal-dependent states.
The Center for Energy and Sustainable Development will be working with Downstream Strategies to update our analyses to reflect the requirements included in the final rules, and we will engage with the state’s leaders over the coming months to share our findings and contribute to the shaping of West Virginia’s energy future.
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