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September 2009 Along Those Lines
Fighting for fairness
Co-ops and consumers impact climate change policy debate
 by Scott Gates
Electric cooperatives, with support from consumers across the country, are seizing opportunities to improve climate change legislation being considered by the U.S. Congress. In June, the partnership bore fruit when the U.S. House of Representatives listened to co-op concerns and revised its climate change bill, H.R. 2454.
Among the revisions: future impacts on co-op consumers’ electric bills were reduced by more than $3 billion over the next 10 years, and possible federal financing will be available to co-ops for nuclear power plants.
“The bill still needs a lot of work, but it could have been much worse. By staying engaged in the process electric co-ops had a measurable impact,” said Glenn English, CEO of the Arlington, Va.-based National Rural Electric Cooperative Association. “More than 375,000 co-op consumers formed a base of support for that effort, mobilized through the ‘Our Energy, Our Future™’ grassroots awareness campaign. In the end, we will weigh the final version against the Clean Air Act.”
At the core of the climate change proposal lays a cap-and-trade system to reduce carbon dioxide emissions. Under cap and trade, greenhouse gas emissions, including carbon dioxide, from power plants and other sources would be required to stay below a set limit — the cap. All emissions would then have to be accounted for by allowances issued by the federal government, which could be swapped and sold — the trade.
English stresses that the U.S. Senate must make climate change legislation fair, recognizing regional differences in how electricity is produced; it must be affordable for all Americans; and its goals must be achievable — when they take effect, the technology needed to reduce carbon dioxide emissions should be commercially viable at each step of the way.
“We will lay down a marker: Any climate change bill considered on the Senate floor must sufficiently protect the interests of consumers and electric co-ops,” English declared. “If it does not, we will then lead the charge to hold up this bill until it is fixed.”
Electric cooperatives and NRECA pushed for changes to the House bill with support from the “Our Energy, Our Future” campaign, which gives consumers a voice through its Web site at www.ourenergy.coop. The effort was enough to reshape H.R. 2454.
“As originally written, H.R. 2454 distributed allowances in an unbalanced way, giving some utilities far more than what was needed while short-changing others. It was not a fair deal,” English said. “Without supporting the bill, co-ops were able to reduce the impacts on co-op consumers’ electric bills where the inequity was the greatest.”
The bill also sets aside a large percentage of allowances for use by “merchant generators,” for-profit power plants that are not tied to any group of consumers but sell electricity on the open market. A recent study, sponsored in part by NRECA, shows that any allocations given to unregulated merchant generators will result in windfall profits for them, without having any impact on carbon emissions. The report notes that nuclear and hydroelectric merchant power plants alone could see profits increase — at the expense of consumers — several billion dollars per year.
“As with any piece of complex legislation, the devil is in the details,” English noted. “In this case, one of the most important details for consumers is the formula used for allocating emission allowances.”
English adds that carbon dioxide regulation will occur with or without the passage of a bill in Congress. In April, the U.S. Environmental Protection Agency proposed an endangerment finding under the federal Clean Air Act, stating that six key greenhouse gases from auto emissions — one of which being carbon dioxide — threaten public health and welfare. This action opens the door for the EPA to issue sweeping regulations cutting carbon dioxide emissions from power plants.
“Our choice in this debate essentially boils down to whether any bill that finally emerges from Congress is truly the best option for our members,” English said. “Rest assured that if Congress loses sight of treating all co-ops fairly and fashioning affordable solutions to America’s energy and climate change challenges, we will not hesitate to fight against a bad bill for co-ops.”
Scott Gates writes for NRECA. To get up-to-the-minute information about the climate bill as it moves to the Senate and its potential impact on electric co-op consumers, please visit www.ourenergy.coop.
Written By: eceditor
Date Posted: 8/31/2009
Number of Views: 298
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