US gov\'t reports set stage for multi-pollutant debate
WASHINGTON - Tightening the Clean Air Act to limit toxic emissions by U.S. power plants would boost power generation costs by tens of billions of dollars over the next 20 years, the U.S. government said in a new pair of reports.
The Energy Information Administration issued the two reports estimating compliance costs of stricter limits on power plant emissions in response to requests by two separate groups of senators who are mulling rival Democratic and Republican bills to curb utility emissions.
Democrats want legislation to sharply reduce four pollutants emitted by utilities - sulfur dioxide, nitrogen oxide (NOx), mercury and carbon dioxide. The Democrats\' approach calls for cuts ranging from 75 to 90 percent.
Republican senators and the Bush administration prefer a narrower bill with market incentives and no limits on carbon dioxide, which they contend would reduce U.S. energy supplies. Carbon dioxide has been linked to global warming.
The reports, released late Tuesday, also reveal the likely battle lines for a so-called \"stakeholder meeting\" scheduled by the Senate Environment committee for Thursday and Friday. At the closed-door meeting, utilities, lawmakers and green groups will discuss legislation to tighten the Clean Air Act.
The panel is headed by Vermont Independent Sen. Jim Jeffords, who aims to move ahead with a full committee hearing and a bill before Congress adjourns at the end of this month.
POWER GENERATION COSTS TO RISE
Jeffords asked the EIA to analyze the impact on consumers of the Democrats\' proposed legislation to limit all four pollutants.
The agency said in its report that imposing proposed limits would require \"significant effort\" by utilities, especially to cut mercury emissions by 95 percent, because \"existing technology may not be able to achieve this level of removal.\"
Jeffords\' proposed changes would raise utilities\' power generation costs by 8 to 9 percent, or $142 billion to $177 billion, the report said.
The EIA issued a separate report in response to a group of Republican senators, who favor less-stringent pollutant curbs.
Sen. Bob Smith of New Hampshire, the Environment Committee\'s ranking Republican, criticized the Democrats\' proposal in a June 8 letter to the EIA requesting a separate analysis. Smith said the Democrats\' plan did not \"reflect the best thinking about the potential to balance emission reductions with market flexibility and regulatory relief.\"
EIA\'s resulting report showed that reducing NOx, sulfur dioxide and mercury to 50 to 75 percent below 1997 levels will deter utilities from burning coal and spur more natural gas-burning facilities.
It would also cost utilities between $28 billion and $89 billion over the next 20 years, depending on the severity of the cuts, the EIA said.
EPA, DOE VIEWS DIFFER
The debate over stricter limits on emissions has also been complicated by conflicting views of the Environmental Protection Agency and the Energy Department.
The Environmental Protection Agency in July signaled it might replace current regulations with a new cap-and-trade regime for NOx, sulfur dioxide and mercury. That kind of market-based approach would allow dirty power plants to buy emission rights from cleaner plants.
The Energy Department opposes EPA\'s proposed cuts because they might hamper U.S. utilities from boosting electricity output - a major DOE priority, environmental sources said.
Green groups said the pair of EIA reports raised fresh questions.
The reports \"raise the fundamental question: is multi-pollutant legislation designed to make the Clean Air Act stronger and to better protect public health and the environment ... or it is designed to provide substantial regulatory relief?\" said Frank O\'Donnell at the Clean Air Trust.
Story by Chris Baltimore
REUTERS NEWS SERVICE
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