The EPA bid farewell to 2011 by permanently closing a long chapter in the history of our nation’s electric grid and opening a new one. The agency’s new rules restricting mercury and other toxic emissions will shutter some of our nation’s oldest, dirtiest, and wasteful coal and oil-fired power plants and move us toward a cleaner, safer and smarter electricity system.
The rules affecting these power plants were exempted from Clean Air Act rules enacted more than 40 years ago because policy makers expected them to shut down in the near future. Now ancient, many of these plants are still spewing pollution with devastating health and environmental impacts. Public health experts say that closing these plants will prevent up to 11,000 premature deaths, 4,700 heart attacks and 130,000 asthma attacks every year.
Obviously this is a major victory for public health and the environment, but it is also a quantum leap in the evolution of our electric grid. These antiquated power plants didn’t just influence the types of power we use, they actually dictated the way the current grid was built. In almost every case, these plants were built by traditional monopoly utilities that decided which plants to build and where to build them, and simply built whatever transmission was needed to connect them to the grid and deliver their power to customers. All of these costs were then passed on to ratepayers.
Shuttering these plants decades after ratepayers have fully paid for them is a big deal for their owners, who reap fat profits from keeping them online. Their alarmist claims about the risks of shutting them down, though not surprising, are baseless. Numerous studies have shown the EPA rules pose no threat to grid reliability or adequate power supplies. In fact, the rules accelerate the historic transformation of our electricity supply that is already under way. Retiring old coal plants paves the way for developing cleaner, cheaper domestic resources that can meet growing electric demand. Renewable electricity, our nation’s richest energy resource, can meet that demand if we build a grid that can tap into it.
The main obstacle to developing our virtually unlimited renewable energy resources is building the transmission to deliver them from the remote places where they are most cost-effective and abundant – the Great Plains, Southwest, and offshore – to population centers where they are needed. A close second last year to natural gas among new generation sources, renewable power is competitively priced, fast to build, and has a proven record of reliability. The EPA rules make the case for building transmission for renewable energy more compelling than ever. The rules should also allay concerns that new transmission lines would unintentionally give new life to old and dirty power plants because it ensures most of them will cease to exist.
The EPA’s announcement comes close on the heels of another landmark policy for our electricity system: FERC Order 1000. Issued in July, this rule gives grid planners new tools for working across arbitrary regional barriers that for decades have prevented interstate transmission lines that could get remote renewables to market from getting built. Order 1000 also requires planners to consider public policies, such as renewable energy standards and environmental regulations, when deciding what to build and where.
Taken together, these rules give regional planners the tools and information to work together and identify the best strategic investments to modernize our grid. A stronger, smarter and more efficient electric system that promotes competition is what we need to reduce rates, improve reliability, and develop the clean, domestic resources that can fuel our nation for the next 30 years and beyond.