Energy defends air pollution regulations, says new rules won’t crash power grid

The Energy Department said Thursday that upcoming air pollution regulations will not threaten the reliability of the country’s electric grid, the latest effort by the Obama administration to counter claims by Republicans and industry officials that the rules could cause power outages.

The department released a report Thursday that analyzed the effects on the electric grid of two Environmental Protection Agency air regulations: the cross-state air-pollution rule and the mercury and air toxics standard.

The Obama administration has launched a full-court press this week to
counter growing attacks by Republicans on EPA air regulations over the reliability of the electric grid just weeks before the agency is scheduled to finalize rules
requiring that power plants install technology to reduce emissions of
mercury and air toxics.

{mosads}The report, which modeled a scenario that DOE says is more stringent than EPA’s regulations, found that “the overall supply-demand balance for electric power in each region examined would be adequate.” The report notes that additional analysis is necessary to determine the effect of the rules on local reliability. But DOE says it is capable of addressing those potential issues on a case-by-case basis.

“Mechanisms exist to address such reliability concerns or other extenuating circumstances on a plant-specific or more local basis, and the Department of Energy is willing to provide technical assistance throughout this process,” the report says.

On a conference call with reporters Thursday, David Sandalow, assistant secretary for policy and international affairs at the Energy Department, said the regulations will not upset the delicate balance between power generation and demand that ensures the grid continues to operate.

“Our analysis showed that the new EPA rules will not compromise resource adequacy,” Sandalow said.

The report comes a day after Gina McCarthy, EPA’s top clean air official, aggressively defended the agency’s clean air rules, insisting they will not threaten the reliability of the grid.

“In the 40-year history of the Clean Air Act, EPA rules have not caused the lights to go out, and we won’t let it happen going forward,” McCarthy, assistant administrator at EPA’s Office of Air and Radiation, said during a technical conference at the Federal Energy Regulatory Commission (FERC) Wednesday.

McCarthy, on the call with reporters Thursday, continued her defense of EPA’s regulations, arguing that the report offers the agency “comfort” as it prepares to finalize the mercury and air toxics standards.

She said the report shows that EPA can implement its clean air regulations and “still maintain the strong, robust electricity supply system.”

McCarthy stressed that “flexibility mechanisms” exist to ensure that individual power plant operators can comply with the regulations, including the option to extend the three-year compliance period by one year.

EPA finalized its cross-state air pollution rule, which requires power plants in Eastern states to reduce air pollution that crosses state lines, in July. The agency is slated to finalize its mercury and air toxics standards, which require power plants to install technology to reduce harmful air pollution, on Dec. 16.

Republicans and electric utilities have increasingly raised concerns that the rules could burden the electric grid by forcing the closure of a large number of power plants.

A study released this week by the North American Electric Reliability Corporation (NERC), an industry group charged with developing reliability standards, lent credence to their concerns.

The NERC study said EPA’s regulations “may significantly affect bulk power system reliability depending on the scope and timing of the rule implementation and the mechanisms in place to preserve reliability.”

McCarthy has attacked the NERC study and other reports that raise the reliability concerns, arguing they assume the regulations are more expensive than they are, include plants that will be shut down regardless of the EPA rules because they are old or inefficient, and don’t take into account other tools for ensuring reliability.