Michigan's coal plants and climate change legislation

by: Eric B.

Mon Jun 29, 2009 at 14:31:43 PM EDT

We've heard a lot of whining over the last few months that the "cost" of coming climate change legislation will kill jobs, destroy industry, kick puppy dogs, sicken orphans ... basically the same old barge filled with scary warnings that have been used since time immemorial about every major piece of environmental legislation (if history is any judge of the efficacy of these warnings, we could pass new climate change bills from today until the end of time and not destroy the economy).  Still, as climate change moves from the House to the Senate, it's worth taking a look at what impact the bill might actually have on internal Michigan deliberations about energy.  Here's what Consumers had to say about the climate bill in a good blog post about Mark Schauer's support for it in the Jackson Citizen Patriot.

Jackson-based Consumers Energy praised Schauer for modifying provisions to the bill that will have a favorable impact on customers as we move toward high-efficiency lighting, but declined to comment on whether the utility supports the actual bill as a whole.

"Consumers Energy praises Congressman Mark Schauer for his actions to make significant improvements to the lighting efficiency standards section of this legislation," Consumers spokesman Dan Bishop said in a statement. "We look forward to ongoing deliberation and debate on this legislation in the U.S. Senate. We will continue to work with Michigan's Senators on further modifications to balance the goal of reducing greenhouse gases with the cost of that effort. We will continue to vigorously participate in discussions and advocate on behalf of our 1.8 million electric customers."

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Credit the Citizen Patriot for at least covering the thing and following what their new represent is doing in Washington.  Also, credit Consumers, which as a utility in a state that relies heavily on greenhouse gas-intensive coal (which means it will be affected to large degree), for not issuing its own baleful story about how this bill would kills jobs, destroy industry ... I hope you catch my drift.  Rather than tear its collective hair out, it's chosen to work within the process while acknowledging that reducing carbon emissions is an important goal to establishment (which makes it more forward looking than some of the voices that claim to be agitating on its behalf).  Anyway, here's a portion from an overview of the bill, as it stands today, that Michigan policy makers ought to be looking carefully at.

Carbon Capture and Sequestration. ACES uses a combination of regulatory requirements and financial incentives to ensure that new coal-fired power plants will operate with carbon capture and sequestration (CCS) technology. All new coal plants permitted after 2020 must use CCS when they commence operations. Coal plants permitted between 2015 and 2020 lose eligibility for federal financial assistance if they do not use CCS when they commence operations; if they do not use CCS when they commence operations, they must retrofit CCS by no later than 2025 without federal financial assistance. Coal plants permitted between 2009 and 2015 lose eligibility for federal financial assistance if they do not retrofit CCS within five years after commencing operations; if they do not retrofit CCS by this date, they must retrofit CCS by no later than 2025 without federal financial assistance. The 2025 retrofit deadline is accelerated if four gigawatts of electricity generation is deployed with CCS before 2025; it may also be extended by EPA by up to 18 months on a case-by-case basis.

Emph. mine. This potentially is all of the coal projects currently in the pipeline here in Michigan (something like five or six of them currently, which could get whittled down even further as financing remains an issue).  Clearly this is something that would be of interest to Consumers, what with its proposed expansion of the Kern-Weadcock plant near Bay City. The last time I read them, the proposed plans didn't include carbon capture technology, but left room that it might eventually be installed.  And, as for the sequestration, despite what the oil and gas industry tells you about half-empty oil wells, it's just not currently feasible, which is why they're studying geologic formations up near Gaylord and Rogers City.

I know what you're thinking ... if we simply get those permits before this bill becomes law (it is in the Senate, after all, where it'll need 60 votes to even come to a vote), then we don't have to worry about these things.  Well, what that CCS technology does is not actually protect the utility, but rather protects rate payers, since the bill would also establish a price for emitted carbon.  Rushing new coal plants through the permitting process right now to get them approved before a climate bill becomes finalized would in fact guarantee that consumers would see even higher utility bills once the program gets off the ground, since those plants wouldn't be built with a carbon capture requirement.

What the state ought to do right now -- which it won't because it makes too much sense -- is to require that new coal plants be built with carbon capture technology and a plan to stash it away right now.  I mean, that technology isn't ready for the marketplace today, but it takes a long time to build a coal plant and it's not like the technology is a state secret.  That is, instead of constantly fighting a future that everyone can see coming seven light years away, engaging and embracing it and turning it to our advantage.