MENU
Fuel Supply, Fleet Fueling, Logistics News & Information
July 2017 Issue

Policy Brief: The Clean Power Plan

August 5, 2015 •

By Keith Reid

On August 3 President Obama announced the latest carbon pollution standards for electricity generation. The final Clean Power Plan is aimed at reducing carbon dioxide emissions by 32% from 2005 levels by 2030–9% percent more ambitious than the proposed rule. There is virtually no pretense at this point of implying that this is natively driven by EPA (not that the agency has ever been particularly shy about developing aggressive regulations), but rather the personal initiative of the chief of the executive branch of government to set another massive policy initiative while bypassing the will of Congress. In fact, the Obama Administration is not shy about owing recent energy policy as a legacy achievement.

While our sector of the energy universe involves downstream petroleum, which itself has received  similar energy decree from on high regarding CAFE standards, truck emission and mileage standards and ozone standards, we feel coverage is of interest to our audience for a variety of reasons:

  • We live in an interconnected energy universe where some common utility fuels like natural gas are shared with transportation and home heating, and potential changes in usage and demand are of interest.
  • The fossil fuels industry is all in this together. Regardless of your personal opinion of the current administration—even supporting it generally or in specific policy areas—if you make a living off of fossil fuels you are currently an enemy of the state. Even natural gas is seen by this administration and its most left-leaning environmental supporters as at best a necessary evil and bridge to an energy future powered by zero-emission wind or solar (regardless of practicality). Ultimately that goes for biofuels as well, and most certainly corn-based ethanol.
  • Motor fuels retailers and marketers are consumers of electricity and that product typically represents a notable expense. That is particularly the case for convenience retailers whose customers expect a well-lit forecourt and a cold beverage when they open the cooler door.
  • Finally, all of our livelihoods depend upon a robust economy. The current administration, the one that said the ACA will drive down healthcare costs and that if you like your doctor you can keep your doctor, claims that its energy policy will have consumers saving “$85 on their annual energy bill in 2030, reducing enough energy to power 30 million homes and save consumers a total of $155 billion from 2020-2030.” Other folks have quite the opposite opinion, seeing it as a trillion-plus dollar drag on our already feeble economy.

Even if you believe that humans and not solar cycles are increasing the temperature of the earth, or that such warming would necessarily have a negative vs. a positive impact on quality of life, as we’ve pointed out before America and the West are not the problem and therefore not the solution. EPA readily admits the climate impact of this draconian regulation will be at best a whopping 0.02 degree Celsius less warming by the year 2100. Unless the China and India get on board we are simply hurting our economy for nothing in return. And if you believe the argument that the China, India and rest of the developing world will similarly cut back their economic growth to follow a U.S. example, then you probably haven’t been paying a great deal of attention to how nations actually operate—or are a member of the New York Times editorial board. A cynical person might also note that much of our current “climate policy” incorporates wealth redistribution schemes both domestically and internationally. There are the hidden, and not so hidden, carbon taxation models and a ready mechanism for the government to gain control over greater and greater sectors of American life. We’ve covered that angle before HERE and HERE.

Offered below are range of punditry positions from all sides of the spectrum to use as a starting point should you be interested in digging into this issue in greater detail.

 

Whitehouse Fact Sheet: President Obama to Announce Historic Carbon Pollution Standards for Power Plants

We have a moral obligation to leave our children a planet that’s not polluted or damaged. The effects of climate change are already being felt across the nation. In the past three decades, the percentage of Americans with asthma has more than doubled, and climate change is putting those Americans at greater risk of landing in the hospital. Extreme weather events – from more severe droughts and wildfires in the West to record heat waves – and sea level rise are hitting communities across the country. In fact, 14 of the 15 warmest years on record have all occurred in the first 15 years of this century and last year was the warmest year ever. The most vulnerable among us – including children, older adults, people with heart or lung disease, and people living in poverty – are most at risk from the impacts of climate change. Taking action now is critical.

https://www.whitehouse.gov/the-press-office/2015/08/03/fact-sheet-president-obama-announce-historic-carbon-pollution-standards

 

The American Spectator: Obama’s Climate Hubris

By Betsy McCaughey
Obama’s Environmental Protection Agency is imposing the Clean Power Plan on all fifty states, requiring each state to close down coal-burning electric plants, and shift to other sources of electricity — natural gas burning plants, nuclear plants, solar and wind power generators — in order to reduce carbon emissions by one third. New York will be less affected because it gets almost all its electric power from nuclear, natural gas, and hydroelectric plants. But nationwide, about 40 percent of electric power is produced by coal plants. Forcing these utilities to close will burn consumers with higher electric bills. It will also send hundreds of thousands of jobs a year up in smoke, as employers pay more to operate their businesses, according to Heritage Foundation economists.
And for what? The purported benefit is to avoid an imperceptible 0.02 degree Celsius increase in global temperatures by the year 2100. That’s the official EPA estimate of the benefits of this Clean Air Plan. You must be kidding.
http://spectator.org/articles/63670/obama%E2%80%99s-climate-hubris

 

The Atlantic: Federal Coercion and the EPA’s Clean Power Plan

By Mario Loyola
One thing the plan’s proponents are losing sight of is the fact that Congress considered, and rejected, the president’s cap-and-trade scheme, notwithstanding Democratic supermajorities in both chambers. The EPA has now figured how to impose it anyway, turning one of the most obscure and little-used provisions of the Clean Air Act one of the most ambitious regulations in the history of the administrative state.
http://www.theatlantic.com/politics/archive/2015/05/federal-coercion-and-the-epas-clean-power-plan/393389/

 

Council on Foreign Relations: Five Takeaways on the EPA’s Clean Power Plan

By Michael Levi
The administration is now relying heavily on wind and solar to meet its 2020 target. But if the Clean Energy Incentive Program isn’t enough to incentivize investment there, the U.S. government will need additional policies on that front. The most obvious place to look is an extension of the Production Tax Credit (PTC) for wind and Investment Tax Credit (ITC) for solar. But these are going to get very expensive (and perhaps politically unsustainable) if they remain in their current forms while investment ramps up to the level that the EPA envisions. Expect renewed administration focus on crafting some sort of legislative deal that would reform and extend the PTC and ITC, perhaps with a sunset around 2020-2021 as the Clean Power Plan phases in.
http://blogs.cfr.org/levi/2015/08/03/five-takeaways-on-the-epas-clean-power-plan/

Share this postShare on LinkedInShare on Google+Tweet about this on TwitterShare on FacebookEmail this to someone