Will the EPA's mercury rule cause a wave of blackouts? No.
Later this afternoon, EPA administrator Lisa Jackson is expected to roll out the agency’s new regulations on mercury and toxic pollution from coal-fired power plants. That raises some questions: Just how many plants will end up getting shuttered as a result of all of the EPA’s new air-pollution rules? And how much of a pain will this be?
It’s a hotly debated topic these days, with industry groups (and plenty of Republicans) predicting possible blackouts and economic havoc, while environmentalists have mostly been rolling their eyes. So, to help settle this debate, the AP’s Dina Cappiello recently surveyed 55 power-plant operators across the country. She found that as many as 68 coal-fired plants — up to 8 percent of the nation’s coal generation capacity — will shut down in the years ahead. (The Edison Electric Institute has estimated that up to 14 percent of coal capacity could be retired by 2022.) That’s no easy task. But, from the available evidence, it also won’t likely prove apocalyptic.
Cappiello’s survey found that the coal plants set to be mothballed are mostly ancient — the average age was 51 — and largely run without modern-day pollution controls, as many of them were grandfathered in under the Clean Air Act. What’s more, many of these plants were slated for retirement in the coming years regardless of what the EPA did, thanks to state air-quality rules, rising coal prices, and the influx of cheap natural gas. “In the AP’s survey,” she writes, “not a single plant operator said the EPA rules were solely to blame for a closure, although some said it left them with no other choice.”
Crucially, none of the operators contacted by the AP seemed to think that huge swaths of America were on the verge of losing power, as Jon Huntsman claimed. An official from the North American Reliability Corporation put it this way: “We know there will be some challenges. But we don’t think the lights are going to turn off because of this issue.” This jibes with an Edison Electric Institute study, as well as a Department of Energy study (which focused on worst-case scenarios), a study from M.J. Bradley & Associates, and the EPA’s own modeling (PDF). Utilities will manage to keep the power running, in part by switching to natural gas, as plenty of gas plants currently operate well below capacity.
At this point, there’s good reason to think that utilities can retire their oldest and dirtiest plants without crushing disruptions. It won’t be simple or cost-free — the EPA estimates that the mercury and air toxics rule alone will cost utilities at least $11 billion by 2016 to install scrubbers on their coal plants, and those costs will likely get passed on to households. On the flip side, the reduction in mercury is expected to prevent some 17,000 premature deaths per year and provide an estimated $59 billion to $140 billion in health benefits in 2016.