Obama Climate Plan Seen Making Coal Plants Less Efficient

(Bloomberg) — The Obama administration’s plan to cut

carbon emissions may force many coal plants to run only when

energy demand peaks, making them less cost-effective, the group

that oversees the U.S. electric system said.

The North American Electric Reliability Corp., a nonprofit

that assures adequate voltage and power reserves, in an

assessment Tuesday asked the Environmental Protection Agency to

delay the 2020 deadline to start implementing the Clean Power

Plan, saying pipelines, transmission lines and plants are needed

to prevent the cuts from disrupting electric service.

“The generation mix in the North American power market is

going through a fundamental change,” Thomas Burgess, vice

president of the group, said on a conference call. “The Clean

Power Plan is expected to accelerate some of those changes.”

President Barack Obama’s plan to combat global warming is

built around the EPA’s carbon proposal, which would require a 30

percent cut in emissions by 2030. The plan is designed to

replace coal as the main source to generate electricity with

increased use of natural gas, renewable power and efficiency

measures.

The emissions plan will have wide-ranging effects on

utilities, forcing changes that will upend models used for a

century for generation and distribution of electricity. The EPA

has said 40 years of clean-air actions have never caused power

outages, and other analysts have said cheap alternatives such as

natural gas and renewable energy will mean the decline in coal

won’t cause major disruptions.

State ‘Flexibility’

The EPA said the power-plant proposal is designed to

protect domestic power supplies.

“The agency’s plan will provide states and utilities the

time and flexibility needed to continue their current and

ongoing planning and investing to modernize and upgrade the

power system,” the EPA said in a statement. “We have a long-standing commitment to safeguard not only public health and the

environment but also a reliable and affordable supply of

electricity for all Americans.”

To meet the outlines of the EPA’s proposed plan, the

industry would need to build natural-gas power plants producing

an additional 46 gigawatts by 2020, said John Moura, the group’s

reliability director. Those would replace shuttering coal

plants.

To contact the reporter on this story:

Mark Drajem in Washington at

mdrajem@bloomberg.net

To contact the editors responsible for this story:

Jon Morgan at

jmorgan97@bloomberg.net

Steve Geimann, Romaine Bostick

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