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January 07, 2013
Energy efficiency to cut CO2

The Natural Resources Defense Council (NRDC) released what it calls a “groundbreaking proposal” to cut carbon emissions from power plants.  In contrast to facility-specific emissions limits typically issued by the EPA under its Clean Air Act authority, the proposal would set state-specific “target emission rates” and provide the states with “broad flexibility” to meet the targets, including adopting energy efficiency programs.

Reduction targets

As described by the NRDC, the EPA would establish an emissions rate for each state for 2020 based on the state’s baseline share of coal and gas generation.  The state standards would be calculated by applying a rate of 1,500 pounds (lb) of CO2/MWh for the baseline coal generation share and 1,000 lb of CO2/MWh for the baseline gas-fired generation share. 

For example, a state that now gets 90 percent of its fossil-fueled electricity from coal and 10 percent from gas would be required to reduce its 2020 emissions rate to 1,450 lb/MWh [(90 percent x 1,500) + (10 percent x 1,000)]. 

In contrast, a state with 90 percent gas-fired generation would have a target of 1,050 lb/MWh [(10 percent x 1,500) + (90 percent x 1,000)]. 

A state starting with a 50:50 ratio of coal and gas generation would have a target of 1,250 lb/MWh. 

The allowable emissions rate would drop further in 2025.  The emissions standard for each state would be an overall emissions rate average of all fossil-fuel plants in the state.  An individual plant could emit at a higher or lower rate.

Power plants would have the option of using traditional pollution control retrofits, switching fuel, or employing advanced techniques (e.g., carbon capture and storage) to lower their emissions.  Alternatively, operators could meet the required rates by averaging emissions among multiple plants. 

Energy efficiency credits

The new thinking in the proposal involves energy efficiency.  State-regulated energy efficiency programs could earn credits for avoided power generation and avoided pollution.  Generators could then purchase and use those credits toward their emissions compliance obligations, effectively lowering their calculated average emissions rate. 

“States could use this provision to slash emissions without costly and lengthy power plant retrofits or new construction, reducing the overall cost of the regulations,” says the NRDC.  “Investments in energy efficiency and demand response are the lowest cost compliance pathway–much cheaper than building new power plants or installing pollution control equipment–so including this flexibility significantly reduces overall costs.”

According to the NRDC, energy efficiency programs adopted under the proposal would bring down overall electrical demand by 4 percent. 

The proposed program would cut carbon pollution from existing power plants by 26 percent by 2020 and 34 percent by 2025, claims the NRDC, and stimulate investments of more than $90 billion in energy efficiency and renewable energy sources over the next 8 years while creating thousands of jobs and boosting state and local economies.

Click here for information on NRDC’s proposal.

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