June 19, 2014
Potential Effects on Consumers of Proposed EPA Rule for Existing Plants? Glad You Asked
Statement of Tyson Slocum, Director, Public Citizen’s Energy Program
Note: Today, the U.S. House of Representatives’ Energy and Commerce Committee’s Subcommittee on Energy and Power holds a hearing to review the U.S. Environmental Protection Agency’s (EPA) proposed greenhouse gas regulations for existing power plants.
U.S. House Republicans today want to delve into the latest greenhouse gas rule’s potential impacts on electricity rates, electric reliability and economic growth.
We’re glad they are asking, because the answer is good news for consumers.
The U.S. Environmental Protection Agency’s (EPA) proposed rule for existing power plants gives states leeway to design energy efficiency, distributed renewable energy programs and other broad-based initiatives that can be implemented with maximum benefits for consumers. In fact, consumers may well see lower electricity bills. There is every reason to believe that scaled-up investment in energy efficiency and renewable energy will be cheaper than relying on coal, especially as new technologies and economies of scale come into play.
In March, for instance, the city of Austin, Texas, signed a 20-year agreement with Recurrent Energy to supply electricity to the city from solar power at a rate less than the city’s prevailing rate, meaning electric rates for households will decline under the solar deal.
Even many regulated utilities, such as American Electric Power, Dominion Resources and Duke Energy, have said that they expect to be able to implement the Obama administration’s climate change plan in a way that keeps rates affordable for consumers.
But what ultimately happens to Americans’ pocketbooks as a result of this rule depends on how states decide to meet it. When designing plans, it is imperative that states ensure low-income consumer have access to affordable energy. And states should ensure that measures are in place to stop utility companies from hoarding cost savings, rather than sharing them with consumers.
Here’s what we can’t afford: doing nothing. Climate change has already begun to impose massive costs on the economy. If we don’t act to curb it, we can look forward to higher water bills, higher health insurance, higher energy costs and higher home costs. And that’s just the beginning.
The EPA’s rule doesn’t go far enough. Already, the U.S. is halfway to achieving the rule’s 30 percent reduction in carbon emissions. According to U.S. Energy Information Administration data, carbon emissions from the energy sector have fallen from 2,417 million metric tons in 2005 to 2,053 in 2013.
We can – and should – strengthen the rule. Doing so will be good for the planet and for consumers.